Oil prices, which fell to near seven-month lows at the opening following a sell-off in the stock market triggered by fears of recessions in China and USAmoderated their losses at the close on Monday, cushioned by concerns that the conflict would spread in the Middle East could affect crude oil supplies.
The futures of the Brent crude oil fell 0.66% to $75.74 a barrel, with prices trading near their lowest level since January. U.S. crude West Texas Intermediate (WTI) 0.78% to $72.94 a barrel, shortly after hitting its lowest level in more than six months.
Stock markets plummeted across the globe Asia due to fears of a recession in USA caused investors to abandon risky assets, while betting that rapid interest rate cuts will be needed to boost growth. economic growth.
Chinese interference
Concerns about a recession in USAfueled by Friday’s weak July payrolls report, “only add to concerns about Chinese demand that have persisted in the oil market for some time,” ING analysts led by Warren Patterson said in a note.
The fall in diesel consumption in China, the world’s largest contributor to demand growth Petroleum, It is also affecting oil.
OPEC+ pressure
Oil has also been under pressure from the decision of the group of producers OPEC+ to maintain its plan to phase out voluntary production cuts starting in October, meaning supplies will rise later this year, analysts say.
OPEC oil output rose in July despite the group’s production cuts, a Reuters poll showed on Friday.
The endless uncertainty in the Middle East
However, oil losses were also limited by geopolitical risks in Middle EastFighting in Gaza continued on Sunday, a day after an unsuccessful round of ceasefire talks in Cairo.
Israel and USA are preparing for a serious escalation in the region after Iran and its allies Hamas and Hezbollah vowed to retaliate against Israel for the killings of the Hamas leader and a senior military commander. Hezbollah last week.
“The risk of a wider regional war, while I still think small, cannot be ignored,” said Tony Sycamore, a Sydney-based market analyst at IG.
Investors are also awaiting last month’s U.S. services data to gauge the health of the world’s largest economy, he added.
“Another fall tonight reinforces the idea that the Fed “is behind the curve,” he said, referring to the US central bank’s delays in interest rate cuts.
Source: Ambito
