Oil fell modestly amid signs that supplies are recovering while concerns persist over demand in China, the world’s biggest crude importer.
West Texas Intermediate futures for October remained below $80 a barrel as lackluster summer trading leaves the market struggling for direction. Iran’s observed exports have risen to 2.2 million barrels a day this month, and Turkey and Iraq have held a sudden flurry of talks as they seek to restart a major pipeline.
A rally in crude oil that began in late June has faltered in recent weeks, with futures about where they were at the start of the year. The efforts of the OPEC axis + Saudi Arabia and Russia to curb production have tightened the market. However, the outlook for demand in China is dim and there are signs that US interest rates will need to stay higher for longer to curb inflation.
“Call it recession fears, headwinds or demand concerns – the OPEC+ group’s supply management strategy has successfully countered that,” said Tamas Varga, analyst at brokerage PVM. “While the oil balance could obviously deteriorate, there is currently no reason to believe that global oil consumption will come close, let alone fall below supply.”
Prices:
- October WTI fell 48 cents to settle at $79.64 a barrel in New York.
- September futures, which expire on Tuesday, settled at $80.35.
- Brent for October settlement fell 43 cents to $84.03 a barrel.
