Falling demand puts pressure on oil prices

Oil installation

SEOUL (Reuters)

Oil prices fell yesterday as fears of an economic slowdown and the trade war between China and the United States led to a reduction in global crude demand growth expectations.
Brent crude futures were trading at $ 58.40 per barrel around 6:38 GMT, down 13 cents or 0.2% from the previous settlement price. West Texas Intermediate (WTI) crude futures prices in the United States were $ 54.33 per barrel, down 17 cents (0.3%) from the previous close. Futures on Brent and WTI tumbled last week, with Brent losing more than 5% and WTI close to 2%.
The trade dispute between the United States and China shook the global stock markets last week, and a sudden increase in US crude oil inventories put downward pressure on oil prices, which lost about 20% of their peaks of 2019 in April.
The International Energy Agency (IEA) said Friday that growing signs of an economic slowdown and a resurgence of trade disputes have slowed growth in global oil demand at a slower pace since the financial crisis The Paris-based agency downgraded its forecast of global oil demand growth in 2019 and 2020. 1.1 million and 1.3 million barrels per day, respectively.
At the same time, two sources close to data from the Russian Ministry of Energy said that oil production in that country reached 11.32 million barrels a day between August 1 and 8, compared to an average of 11.15 million barrels a day in July.
The Organization of Petroleum Exporting Countries (OPEC) and its allies, including Russia, agreed in July to extend their supply reduction agreement until March 2020 to support crude prices.
Kuwait's Petroleum Minister Khalid al-Fadhil said yesterday that his country is fully committed to an agreement between the oil-exporting countries to reduce production to support crude oil prices. He added that his country has reduced its production more than required by this agreement. According to the Kuwaiti News Agency (KUNA), Fadil reportedly said, "Kuwait's commitment for the implementation of the production reduction agreement reached about 160% last July" . He said exaggerated concerns over the global economic slowdown, which has put downward pressure on prices, and that global demand for oil will recover in the second half, which will help to gradually reduce excess stocks of crude oil. The Organization of Petroleum Exporting Countries (OPEC), Russia and other non-OPEC producers, the group known as OPEC +, have agreed to reduce their production of 1.2 million barrels per day from January 1 for a period of six months under an agreement to prevent global stocks and increase prices.