Oil prices fell on Monday as concerns over slowing economic growth amid global trade tensions were cited as catalyst for the selling.
Brent Oil Futures for October delivery fell 0.23% to $72.64 per barrel at 12:25AM ET (04:25 GMT). Meanwhile, Crude Oil WTI Futures for September delivery fell 0.1% to $67.56 a barrel.
Analysts believe recent data that showed signs of slowing economic growth and trade dispute between China and the U.S. are putting oil prices under pressure. “Lower demand from China, the world’s biggest importer, comes at a critical time when demand growth from Asia in general is being called into question. This due to the negative impact of trade wars, a stronger dollar and rising funding costs,” Ole Hansen, head of commodity strategy at Denmark’s Saxo Bank, said in a note late last week.
U.S. crude prices suffered their sixth straight weekly loss last week – their worst losing streak since August 2015 as investors worried that global trade disputes, most notably between the U.S. and China, could slow economic growth and hurt demand for energy.
In the latest round of levies, China said it would impose additional tariffs of 25% on $16 billion worth of U.S. imports.
Meanwhile, U.S. crude received some support earlier in the day on news that the U.S. has begun imposing new sanctions against Iran, which from November will also target the country’s petroleum sector. “With U.S. sanctions on Iran back in place … all eyes have been on the impact on crude oil exports from that country,” ANZ bank said on Monday.”
Maintaining global supply might be very challenging,” the bank said, adding that that “the U.S. is doing its bit to increase production, with data showing drilling activity is continuing to rise.”
The International Energy Agency (IEA), in its monthly report published Friday, confirmed that Iran’s output continued to fall last month, reaffirming expectations that Washington’s tough stance on sanctions against Tehran were starting to curb demand for crude from the Islamic Republic.
Iran’s output was the lowest since April last year at 3.75 million bpd, with buyers in Japan, South Korea and India already dialing back orders.