Oil prices fall as clouds of trade war between US and China demand prospects

BEIJING / SINGAPORE (Reuters) – Oil markets plummeted on Tuesday, as the latest escalation of the Sino-US trade war clouded prospects for gross demand from both countries, the world's biggest crude oil consumers.

Brent LCoC1 futures prices fell 29 cents, or 0.37%, to $ 77.76 per barrel at 0632 GMT.

United States West Texas Intermediate (WTI) crude CLc1 crude was down 15 cents, or 0.22 percent, to $ 68.76 per barrel.

US President Donald Trump said Monday he would impose 10% tariff on about $ 200 billion of Chinese imports.

"The growing trade dispute has hurt business sentiment. The impact on economic growth is slowly being felt, further impeding oil prices, "said Wang Xiao, head of crude research at Guotai Junan Futures on Tuesday.

Refineries in the United States consumed about 17.7 million barrels of crude oil per day (bpd) last week, while Chinese refiners used about 11.8 million barrels a day in August, according to government data provided by these countries.

Customs duties are likely to limit economic activity in China and the United States, potentially affecting the growth of oil demand, as less fuel is consumed to transport goods for trade.

Countries are the two largest economies in the world.

However, potential reductions in supply caused by US sanctions against Iran, the third largest producer among members of the Organization of Petroleum Exporting Countries (OPEC), provide support for oil prices .

Sanctions affecting the Iranian oil sector will come into effect on November 4.

Oil production from seven major American shale formations is expected to increase from 79,000 b / d to 7.6 million b / d in October, the US Energy Information Administration announced Monday.

Reuters market analyst Wang Tao's technical analysis showed that oil prices in the United States failed to overcome a resistance level of $ 69.85 per barrel, indicating a dissipation of the positive outlook.

Brent could fall more than $ 1 to $ 76.37 a barrel, while WTI crude prices could see their September 14 low of $ 67.94, he wrote.

On Monday, Russian Energy Minister Alexander Novak said that OPEC and non-OPEC members would discuss all possible supply scenarios when they meet this month. Algeria. Russia, the world's largest oil producer, and other OPEC producers have entered into a supply agreement to maintain prices while supplying enough oil to the market.

OPEC Secretary General Mohammad Barkindo said on Tuesday that OPEC and non-OPEC countries are reaching an agreement on long-term cooperation by December.