Brent crude futures declined 56 cents, or 0.7%, to $76.37 a barrel while U.S. WTI crude slid 45 cents, or 0.6%, to $73.10 a barrel
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 U.S., the world’s two biggest oil consumers, raised concerns about future consumption growth.
Brent crude futures declined 56 cents, or 0.7%, to $76.37 a barrel by 0646 GMT while U.S. West Texas Intermediate (WTI) crude slid 45 cents, or 0.6%, to $73.10 a barrel.
The losses followed a 0.3% drop for Brent last week and a 1.7% drop for WTI.
The OPEC and their allies, known as OPEC+, is set to proceed with a planned oil output hike from October, sources from the producer group told Reuters.
Eight OPEC+ members are scheduled to boost output by 180,000 bpd in October, as part of a plan to begin unwinding their most recent round of output cuts of 2.2 million barrels per day while keeping other cuts in place until end-2025.
There are concerns that OPEC will go ahead and raise output from October, according to IG market analyst Tony Sycamore.
However, I think that outcome is price dependent in that it happens if the WTI price is near $80 than $70, he added.
Both Brent and West Texas Intermediate have posted losses for two successive months as the U.S. 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 Middle East conflict.
While Libyan exports remain halted, the Arabian Gulf Oil Company has resumed output at up to 120,000 bpd to meet domestic needs, engineers said on Sunday, after the standoff between the factions shut most of the country’s oilfields.
More pessimism about Chinese demand growth surfaced after an official survey showed on Saturday that manufacturing activity there sank to a six-month low in August as factory gate prices declined and owners struggled for orders, although a private survey on Monday which covers smaller, export-oriented firms showed signs of a tentative recovery in August.
The softer-than-expected China PMI released over the weekend heightens concerns that the Chinese economy will miss growth targets, Sycamore added.
