Oil prices largely remained stable amid rising expectations that the Organization of the Petroleum Exporting Countries (OPEC) will continue to withhold supplies that diffused concerns of economic slowdown.
Brent crude edged up 1 cent to $62.30 a barrel, while US West Texas Intermediate gained 40 cents to touch $53.66 per barrel, reported Reuters.
The oil market was also buoyed by Russia’s statement that it may support an extension to the ongoing supply cuts. The prices also received support after China relaxed financing rules to support the economy.
Russia has been a member of the OPEC-led group that reduces supplies to revive prices since the beginning of 2019. The group, known as OPEC+, is scheduled to meet soon to discuss the future of their output policy. They are also working to prevent build-up of a global oil inventory, which may again affect oil prices.
However, oil prices were capped by lingering concerns of slowing demand and economic slowdown. The prices of global benchmark Brent dropped nearly 20% from its 2019 peak of around $75 a barrel in April due to such concerns.
JBC Energy analysts were quoted by Reuters as saying: “It is proving hard work papering over a suite of rather less supportive data being digested by the market.”
Analysts estimate that decelerating global economy will significantly impact fuel consumption. Energy consultancy FGE told Reuters that the global crude demand growth could drop below 1 million barrels per day (bpd) this year, substantially less from the previously predicted figure of around 1.3 to 1.4 million bpd.