# Oil slips as economic worries take focus off tighter supplies Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-05-15 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Oil Slips as Economic Worries Take Focus off Tighter Supplies Meta Description: Stay updated on the latest oil price trends with concerns over fuel demand in top global consumers overshadowing supply cuts from OPEC+ and US reserves URL: https://financedigest.com/oil-slips-as-economic-worries-take-focus-off-tighter-supplieshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-05-15t015420z1lynxmpej4e017rtroptp4global-oil-1736814019201-compressed.jpg) By Florence Tan and Mohi Narayan (Reuters) -Oil prices fell on Monday as concerns about fuel demand in the top global oil consumers, the United States and China, offset bullish sentiment about tightening supplies from OPEC+ cuts and a resumption in U.S. buying for reserves. Brent crude futures fell 26 cents, or 0.35%, to $73.91 a barrel by 0638 GMT, while U.S. West Texas Intermediate crude was at $69.34 a barrel, down 20 cents, or 0.29%. Last week, both benchmarks fell for a fourth consecutive week, the longest streak of weekly declines since September 2022, over [concerns the United States could enter a recession on “significant risk” of a historic default within the first two weeks](https://www.financedigest.com/oil-edges-up-but-on-track-for-big-weekly-drop-on-supply-concerns.html "Oil edges up but on track for big weekly drop on supply concerns") of June. [Investors sought safe](https://www.financedigest.com/analysis-investors-face-expensive-quest-for-year-end-cash-and-safe-assets.html "Analysis-Investors face expensive quest for year-end cash and safe assets") havens such as the U.S. dollar, strengthening the currency and making dollar-denominated commodities more expensive for holders of other currencies. \[FRX/\] [“Oil prices are still under pressure on sluggish demand](https://www.financedigest.com/oil-prices-head-for-fourth-weekly-drop-as-demand-fears-weigh.html "Oil prices head for fourth weekly drop as demand fears weigh") outlooks as China’s economic reopening progress seems bumpy,” CMC Markets analyst Tina Teng said, adding that the U.S. [banking rout has also caused market](https://www.financedigest.com/why-smes-are-the-number-one-market-opportunity-in-digital-banking.html "Why SMEs are the number one market opportunity in digital banking") jitters. Investors will scour China’s slew of economic data on [industrial output](https://www.financedigest.com/euro-zone-industry-output-falls-sharply-with-ireland-plunge.html "Euro zone industry output falls sharply, with Ireland plunge"), fixed assets investment and retail sales in the week ahead for signs of oil demand improvement, she said. With the uneven re-opening in [China and concerns](https://www.financedigest.com/oil-up-on-lower-u-s-crude-stocks-and-dollar-opec-and-china-concerns-limit-gains.html "Oil up on lower U.S. crude stocks and dollar, OPEC+ and China concerns limit gains") that the U.S is facing a growth slowdown at a time when the X-date for the [debt ceiling](https://www.financedigest.com/world-stocks-climb-on-hopes-of-successful-debt-ceiling-outcome.html "World stocks climb on hopes of successful debt ceiling outcome") is rapidly approaching, topped off by a rally in the U.S dollar, [market sentiment towards](https://www.financedigest.com/the-atherectomy-devices-market-to-show-an-inclination-towards-digitized-innovation.html "The Atherectomy Devices Market to show an inclination towards digitized innovation") crude oil will remain tepid at best,” IG analyst Tony Sycamore said. Still, global [crude supplies could tighten](https://www.financedigest.com/oil-prices-slip-as-economic-fears-offset-tightening-crude-supplies.html "Oil prices slip as economic fears offset tightening crude supplies") in the second half as the OPEC+ grouping, the Organization of the Petroleum Exporting Countries and its allies, including Russia, is making additional output cuts that are reducing sour crude availability. The group announced in April that some members would cut output further by around 1.16 [million barrels per day](https://www.financedigest.com/royal-mail-says-uk-business-losing-one-million-pounds-a-day-amid-union-clash.html "Royal Mail says UK business losing one million pounds a day amid union clash"), bringing the total volume of cuts to 3.66 million bpd, according to Reuters calculations. However, Iraq does not expect [OPEC+ to make further cuts to oil output](https://www.financedigest.com/oil-dips-opec-sticks-to-gradual-output-hikes.html "Oil dips; OPEC+ sticks to gradual output hikes") at its next meeting in June, said its oil minister, Hayan Abdel-Ghani. The U.S. could start repurchasing oil for the Strategic Petroleum Reserve (SPR) after completing a congressionally mandated sale in June, [Energy Secretary Jennifer Granholm told](https://www.financedigest.com/germans-told-to-unite-over-energy-crisis-amid-eu-divisions.html "Germans told to unite over energy crisis amid EU divisions") lawmakers on Thursday. This announcement was followed by a weekly [report by energy services](https://www.financedigest.com/hair-transplant-services-market-report.html "Hair Transplant Services Market Report") firm Baker Hughes Co that showed the number of U.S. [oil rigs](https://www.financedigest.com/rebound-in-the-oil-gas-exploration-and-production-activities-to-boost-mobile-servicing-rig-market-fact-mr-report.html "Rebound In the Oil & Gas Exploration and Production Activities to Boost Mobile Servicing Rig Market, Fact.MR Report") fell by two to 586 this week, their lowest since June 2022, while the number of gas rigs plunged by 16 to 141. Meanwhile, leaders of the Group of Seven (G7) nations could announce new measures at their May 19-21 meetings that [target sanctions](https://www.financedigest.com/explainer-how-western-sanctions-will-target-russia.html "Explainer-How Western sanctions will target Russia") evasion involving third countries, said officials with direct knowledge of the discussions. The tightening of sanctions will also seek to undermine Russia’s future [energy production and curb trade that supports](https://www.financedigest.com/uk-consumer-industries-warn-curbing-energy-support-will-hit-demand.html "UK consumer industries warn curbing energy support will hit demand") the Russian military, the people said. [India and China](https://www.financedigest.com/apple-plans-to-cut-iphone-14-production-lag-between-china-india-bloomberg.html "Apple plans to cut iPhone 14 production lag between China, India – Bloomberg"), the world’s No. 3 and No. 1 crude importers, respectively, have been the key buyers of [Russian crude since the European Union embargo](https://www.financedigest.com/russian-urals-crude-oil-prices-jump-ahead-of-eu-embargo.html "Russian Urals crude oil prices jump ahead of EU embargo") started in December. (Reporting by Florence Tan in Singapore and Mohi Narayan in New Delhi; Editing by Muralikumar Anantharaman and Gerry Doyle) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---