Economy

Oil steadies above $62 as OPEC cuts counter growth concerns

Oil steadies above $62 as OPEC cuts counter growth concerns”

Russian Energy Minister Alexander Novak said on June 10 he could not rule out a scenario in which oil prices could fall to $30 per barrel if the global oil deal was not extended.

U.S. withdrawal of tariff threat against Mexico removed cloud over global economy.

U.S. WTI crude futures were up 0.6% to $53.59, while global benchmark Brent gained 0.3% to $62.45.

US West Texas Intermediate (WTI) crude futures were at $54.32 per barrel, up $0.33, or 0.6%.

President Vladimir Putin said last week that Russian Federation and the Organization of the Petroleum Exporting Countries disagreed over what constituted a fair oil price, but that they would decide at the meeting.

There is a still a risk oil producers pump too much crude and prices fall, Novak said on Monday, suggesting he might support an extension of output cuts at a meeting of leading oil producers next month. "A lot depends on the market in the third quarter, on the supply and demand balance", he said, citing the effect of US-led trade wars and sanctions.

"With China slowing, the European Union sickly and the US data starting to wobble, an economic downturn remains a clear and present danger", said Stephen Innes, managing partner at Vanguard Markets.

Last week, Brent plunged to a record low, registering a almost 16 per cent decline over the last three weeks, its worst performance since January.

China's crude oil imports slipped to around 40.23 million tonnes in May, from an all-time high of 43.73 million tonnes in April, customs data showed, due to a drop in Iranian imports caused by US sanctions and refinery maintenance.

Despite Monday's increases, traders said concerns about the health of the global economy and its impact on fuel demand still weighed on oil market sentiment.

Morgan Stanley has said that demand by major consumers including the United States, China, Japan, Australia, South Korea, Brazil, India, and Thailand has been notably weak-and those eight countries represent 48 percent of global oil demand.

Slowing demand has also contributed to a slump into negative territory in refining profits for Asian naphtha, an important feedstock for the petroleum industry, to levels not seen in over a decade.



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