Oil prices were pulled down by growing concerns over the prospect of a global economic slowdown. Credit: Gary Sutherland.

Oil prices have declined due to signs of rising supply despite the onset of US sanctions on Iran from 4 November, as well as growing worries that demand for oil may be affected on the prospect of a global economic slowdown.

Brent crude futures for January fell 37 cents, or 0.49%, to $74.67 a barrel, while West Texas Intermediate (WTI) crude futures dipped 29 cents to $65.02, Reuters reported.

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Both futures posted monthly losses, which represent their worst monthly performance since July 2016. Brent fell 8.8% for the month, while WTI slipped 10.9%.

According to the US Energy Information Administration data, US crude inventories for the week ending 26 Oct increased for a sixth straight week.

“Oil investors are now betting on the potential of a global slowdown.”

ANZ Research analysts were quoted by the news agency as saying: “The strong build in oil inventories is likely to keep downward pressure on oil prices.”

A survey conducted by Reuters revealed that the Organization of the Petroleum Exporting Countries (OPEC) raised oil production last month to its highest levels since 2016.

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The increase in output, which primarily originates from the UAE and Libya, countered reductions in Iranian crude exports.

In a presidential memorandum, US President Donald Trump stated that there was sufficient supply of petroleum and petroleum products to support a reduction in purchases from Iran.

Meanwhile, prices were pulled down amid increasing concerns over the prospect of a global slowdown.

Huatai Great Wall Capital Management analyst Bruce Xue said: “Oil investors are now betting on the potential of a global slowdown.”

The ongoing trade war with the US, along with slowing domestic and external demand, appears to have affected China’s manufacturing sector as growth numbers suggested the sector grew at its weakest pace in more than two years.