Crude oil prices dipped more than 1% on Tuesday over concerns that OPEC may increase oil supply increase and falling demand in China.
Brent crude reached $62.91 a barrel, a decline of $0.78, or 1.2%, after losing 1.1% in the previous day, while the US West Texas Intermediate (WTI) crude dropped $0.74, or 1.2%, to reach $59.90 a barrel.
Nissan Securities research general manager Hiroyuki Kikukawa said that concerns are raised among investors over the possible global oil supply boost by the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+.
Kikukawa added: “Oil prices remained under pressure as investors were making position adjustments ahead of the OPEC meeting.”
The meeting scheduled this week could result in OPEC allowing about 1.5 million barrels per day (bpd) of crude into the market, according to Reuters.
Last month, OPEC oil output dropped following Saudi Arabia’s voluntary supply cut and agreed reductions under the OPEC+ pact signed earlier.
Kikukawa added that the weak manufacturing data out of China has resulted in reduced market sentiment.
Moreover, factory activity growth in China reduced to a nine-month low last month. This could limit crude demand in the country and pressure oil prices, according to the news agency.