Global oil prices fell as weak demand forecasts negated the expectations that major producers will restrict production to prevent the recent decline in crude prices.

International benchmark Brent crude futures LCOc1 slipped 48 cents to $58.09 a barrel, while the US West Texas Intermediate (WTI) CLc1 futures were down 41 cents to trade at $54.52 per barrel, reported Reuters.

Late last week, Saudi Arabia said that it will maintain crude exports below seven million barrels per day this month and throughout September to reduce global oil inventories.

Saudi Arabia, the de-facto leader of oil cartel the Organization of the Petroleum Exporting Countries (OPEC), is expected to take steps to support oil prices before floating Saudi Aramco, the national petroleum and gas company.

VM Markets managing partner Stephen Innes was quoted by Reuters as saying: “Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price.”

Currently, the oil cartel group along with other key producers known as OPEC+, are restricting production by 1.2 million barrels per day (bpd) to prop up the price level.

Earlier, Kuwait oil minister Khaled al-Fadhel said it has reduced output by more than the required amount to support prices.

However, rising US shale oil production continues to offset the impact of OPEC+ supply cuts.

According to the US Energy Information Administration, production from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) next month to a record 8.77 million bpd.

In addition to supply factors, oil prices are dragged by ongoing trade tensions between the US and China.