Oil prices fall on worries over the demand growth outlook
On Monday oil prices edged lower amid concerns about an economic slowdown and the Sino-U.S. trade war, which have led to a cut in the growth outlook for global oil demand. Oil prices have lost around 20% from their 2019 peaks reached in April.
"Oil prices are falling at the start of the trading week due to lower demand forecasts published last week and pessimism about a U.S.-China trade deal," said Alfonso Esparza, senior market analyst at OANDA in Toronto.
Goldman Sachs (NYSE:GS) said in a note on Sunday fears of the U.S.-China trade war leading to a recession were increasing, and it expected a trade deal between the two countries to happen before the 2020 U.S. presidential election.
Brent crude futures were at $58.40 a barrel by 0638 GMT, down 13 cents, or 0.2%, from their previous settlement, while U.S. WTI futures were at $54.33 per barrel, down 17 cents, or 0.3%, from their last close. Both benchmarks fell last week, with Brent losing more than 5% and WTI falling about 2%.
The weekly U.S. oil rig count, an early indicator of future output, fell for a sixth week in a row as producers cut spending on new drilling and completions.
Mounting signs of an economic slowdown and a ratcheting up of the trade row have caused global oil demand to grow at its slowest pace since the financial crisis of 2008, the International Energy Agency (IEA) said on Friday.
The Paris-based agency cut its 2019 and 2020 global oil demand growth forecast to 1.1 million and 1.3 million barrels per day (bpd), respectively.