Oil prices largely stable as supply cuts offset economic slowdown concerns

18 March 2019 (Last Updated March 18th, 2019 12:57)

Global oil prices remained largely mixed as concerns over economic downturn continue to drag while supply cuts supported the market.

Global oil prices remained largely mixed as concerns over economic downturn continue to drag while supply cuts supported the market.

Brent crude oil futures gained 8 cents from their last close to touch $67.24 per barrel, while US West Texas Intermediate (WTI) futures were down by 9 cents to $58.43 a barrel, Reuters reported.

The global oil market has been under pressure with growing concerns that slower economic growth may reduce demand.

The US manufacturing output dropped in February, the second consecutive monthly drop indicating slowdown of the largest economy in the world.

Japanese exports also slipped for the third straight month in February 2019, escalating slowdown concerns.

However, oil prices continued to receive support from output cuts by the Organization of the Petroleum Exporting Countries (OPEC) member nations and some non-affiliated allies such as Russia.

“US manufacturing output dropped in February, the second consecutive monthly drop indicating slowdown of the largest economy in the world.”

The participating countries have pledged to reduce production by 1.2 million barrels per day (Mbpd) to revive oil prices.

The ongoing US sanctions against major oil producers Iran and Venezuela have helped the oil market.

Last week, the International Energy Agency (IEA) said that the oil market may be in a modest deficit from the second quarter of this year.

Overall global oil production is expected to be determined by the output in the US, where crude production increased by nearly 2 Mbpd over 2018.

In February crude oil production from the US touched 12.1 Mbpd, according to data from the Energy Information Administration (EIA).