By Florence Tan
SINGAPORE (Reuters) – Oil prices fell further on Monday as investors weighed higher OPEC+ output from October against a sharp drop in Libyan output amid weak demand from China and the United States, the world’s two biggest oil consumers.
Brent crude futures fell 57 cents, or 0.7%, to $76.36 a barrel by 0108 GMT, while U.S. West Texas Intermediate crude fell 50 cents, or 0.7%, to $73.05 a barrel.
The losses followed a 0.3% drop in Brent last week and a 1.7% drop in WTI.
The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, will begin a planned increase in oil production from October, six sources within the producer group told Reuters.
Eight OPEC+ members are expected to increase production by 180,000 barrels per day in October, part of a plan to reverse their most recent 2.2 million barrels per day output cuts and maintain other cuts through the end of 2025.
“There are concerns that OPEC will ramp up production from October,” said IG market analyst Tony Sycamore.
“However, I think the outcome is price dependent, in the sense that this happens when the WTI price is closer to $80 than $70.”
In Libya, the Arabian Gulf Oil Company has resumed production of up to 120,000 barrels per day to meet domestic demand, but exports are still at a standstill, engineers said Sunday, after a standoff between parties shut down most of the country’s oil fields.
Both Brent and WTI have suffered two straight months of losses as economic concerns in China and the US outweighed Libyan supply disruptions and rising geopolitical tensions in the Middle East.
An official survey on Saturday showed that manufacturing activity in China fell to a six-month low in August, as factory prices fell and owners struggled to secure orders, putting pressure on policymakers to press ahead with plans to provide more stimulus to households.
“The weaker-than-expected Chinese PMI released over the weekend adds to concerns that the Chinese economy will miss its growth targets,” Sycamore said.
In the US, oil consumption fell in June to its lowest seasonal level since the 2020 coronavirus pandemic, data from the US Energy Information Administration showed on Friday.
“We expect downward growth in 2025, driven by economic headwinds in China and the US,” analysts at ANZ said in a note.
“We believe OPEC has no choice but to delay the phasing out of voluntary production cuts if it wants higher prices.”
The number of operational U.S. oil platforms remained unchanged at 483 last week, Baker Hughes said in its weekly report.
(Reporting by Florence Tan; Editing by Sonali Paul)
