(London) Oil prices fell slightly on Monday, short of breaking $80 a barrel for Brent as most of the gains evaporated after OPEC production cuts amid concerns about the global economy.
At around 6 am (ET), a barrel of Brent North Sea crude for delivery in June added 0.39% to $81.34.
Its American equivalent, a barrel of West Texas Intermediate (WTI) for delivery in the same month, fell 0.26% to $77.67.
“The prospect of weaker economic growth is having an impact on the outlook for global oil demand,” summarizes Ricardo Evangelista, Analyst at ActivTrades.
With inflation continuing around the world, investors are increasingly anticipating that monetary policies will be further tightened, affecting the economy and thus the appetite for crude oil.
In this context, prices are retreating after the high recorded in early April, when several members of the Organization of the Petroleum Exporting Countries and their allies (OPEC +) announced voluntary production cuts.
Compared to its level at the end of March, just before the production cuts were announced, Brent rose 1.95% and WTI 0.95%.
However, ING analysts note that demand continues, particularly in India, where imports increased last year and in recent months.
“Local refineries processed a record 23,000 tons in March, up slightly by 3% year-on-year,” they comment.
And China, the world’s largest importer, may see its consumption increase as the Golden Week holiday approaches next week, encouraging travel within the country.
Thursday’s US growth data may also affect the demand outlook from the world’s largest consumer of black gold.
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