Crude oil prices weaken; OPEC+ meeting, API inventories due
2024.10.01 10:27
Investing.com — Oil prices retreated Tuesday, adding to the previous month’s losses as Middle East tensions were overshadowed by weak global demand growth and concerns of increased supply.
By 09:20 ET (13.20 GMT), the futures traded 0.9% lower at $67.58 a barrel and the contract dropped 0.8% to $71.11 a barrel.
Israel raids into Lebanon
Israel said early on Tuesday that its troops had begun “limited” raids against Hezbollah targets in the border area of Lebanon, a move that risks escalating a conflict in the oil-rich Middle East that threatens to suck in the U.S. and Iran.
A serious escalation of the conflict could hit global supply given the importance of this oil-rich region, but “the market has become increasingly numb to the tension in the region given that, after almost a year of conflict, there has still been no impact on oil production,” said analysts at ING, in a note.
China’s economic woes weigh
The crude market struggled in September, mainly on concerns over the economic weakness in China, the world’s largest importer of oil.
Data released on Monday indicated that Chinese shrank sharply in September, a private sector survey showed on Monday.
Chinese authorities have announced a series of stimulus measures over the past week in an attempt to bring China’s 2024 growth back to around the targeted 5%, but the private sector survey suggests more still needs to be done.
Brent ended September down 9%, its third month of declines and largest monthly drop since November 2022. It also slumped 17% in the third quarter for its biggest quarterly loss in a year. WTI fell 7% last month and dropped 16% for the quarter.
OPEC+ set to meet this week
The members of OPEC and allies, a group widely known as OPEC+, will hold its Joint Ministerial Monitoring Committee meeting on Wednesday.
The group is scheduled to raise output by 180,000 barrels per day each month, starting in December, and thus little change is expected at this meeting.
Currently, OPEC+ is cutting output by 5.86 million bpd, or about 5.7% of global demand.
The industry group is set to reveal its weekly estimate of US crude oil and fuel stockpiles in the week to Sept. 27
