Shafaq News/ Oil prices extended losses on Monday on expectations for higher OPEC+ production starting in October and as signs of sluggish demand in China and the US, the world's two largest oil consumers, raised concerns about future consumption growth.
Brent crude futures fell 61 cents, or 0.8%, to $76.32 a barrel by 0450 GMT while US West Texas Intermediate crude slipped 52 cents, or 0.7%, to $73.03 a barrel.
The losses followed a 0.3% decline for Brent last week and a 1.7% drop for WTI.
The Organization of the Petroleum Exporting Countries (OPEC) and their allies, a group known as OPEC+, is set to proceed with a planned oil output hike from October, six sources from the producer group told Reuters.
Eight OPEC+ members are scheduled to boost output by 180,000 barrels per day (bpd) in October, as part of a plan to begin unwinding their most recent layer of output cuts of 2.2 million bpd while keeping other cuts in place until end-2025.
"There are concerns that OPEC will go ahead and increase output from October," IG market analyst Tony Sycamore said.
"However, I think that outcome is price dependent in that it happens if the WTI price is closer to $80 than $70."
Both Brent and WTI have posted losses for two consecutive months as the US and Chinese demand concerns have outweighed recent disruptions in Libyan oil supply amid a dispute between government factions there and the tensions in the key Middle East producing region related to the Israel-Gaza conflict.
"The softer-than-expected China PMI released over the weekend heightens concerns that the Chinese economy will miss growth targets," Sycamore said.
In the US, oil consumption slowed in June to the lowest seasonal levels since the coronavirus pandemic of 2020, data from the Energy Information Administration showed on Friday.
"We see downside in growth in 2025, driven by economic headwinds in China and the US," ANZ analysts said in a note.
"We believe OPEC will have no choice but to delay the phase out of voluntary production cuts if it wants higher prices."
The number of operating US oil rigs were unchanged at 483 last week, Baker Hughes said in its weekly report.
(Reuters)