Image: Reuters Berita 24 English - Early on Monday, oil prices slid as investors refocused on tight supply, however sentiment remained sha...
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| Image: Reuters |
Berita 24 English - Early on Monday, oil prices slid as investors refocused on tight supply, however sentiment remained shaky after a 6% drop the previous day amid fears about slowing global economic growth and fuel demand.
Brent crude futures were up 20 cents, or 0.2 percent, to $113.32 a barrel at 0105 GMT, after jumping as much as 1% earlier. Last week, front-month prices fell 7.3 percent, the first weekly drop in five weeks.
The price of West Texas Intermediate crude in the United States was $109.55 a barrel, down 1 cent after jumping more than $1 in early morning trading. Last week, front-month prices fell 9.2 percent, the first drop in eight weeks.
"For the time being, oil supply issues are taking a second seat to fears about weakening demand," according to ANZ analysts.
"Despite the continuous downturn in Russian output, the basic picture remains tight."
Due to Western sanctions, most countries are unable to obtain Russian oil. The damage has been partially offset by the release of strategic petroleum reserves, led by the United States, and a ramp-up of output from OPEC+, while the world's buffer against additional supply interruption is shrinking.
"By October, the US strategic reserve will have dropped to a 40-year low of 358 million barrels," according to ANZ.
Despite this, oil and gas production in the United States is increasing.
The oil and gas rig count, a leading indication of future output, increased by seven to 740 in the week ending June 17, the highest level since March 2020, according to Baker Hughes Co, an energy services firm.
Following blockades by factions in Libya's east, oil production has remained erratic.
On Monday, Libyan oil minister Mohamed Oun told Reuters that the country's overall output is around 700,000 barrels per day (bpd). Libya's oil output was 100,000-150,000 barrels per day last week, according to a spokesman for the oil ministry.
Exports of oil products from China, which was formerly a significant exporter, have continued to fall, putting pressure on world supply.
Despite stalled domestic demand, China's gasoline exports declined 45.5 percent in May and diesel exports tumbled 92.7 percent as companies ran out of export quotas, according to Chinese customs statistics released on Saturday.
