Oil Stays Weak On China's Fresh COVID-19 Curbs: Supply News Trickles In Ahead Of OPEC+ Meet

Oil Stays Weak On China's Fresh COVID-19 Curbs: Supply News Trickles In Ahead Of OPEC+ Meet

Oil continued to trade lower in Asia trading on Thursday morning, following a weak finish in the previous session on the back of demand concerns as China announced fresh restrictions to limit COVID-19.

West Texas Intermediate futures were trading 0.5% down at $89.09/barrel at press time.

Small Surplus: The oil market will see a small surplus of just 0.4 million barrels per day in 2022, lower than the earlier forecast, due to the underproduction of its members, reported Reuters, citing OPEC+ sources. The news comes ahead of an OPEC+ policy meeting scheduled for Sept. 5.

Last week, Saudi Energy Minister Prince Abdulaziz bin Salman said OPEC+ is ready to reduce output amid volatility in the oil futures market, driven by thin liquidity and a disconnect with physical markets.

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U.S. Stockpiles: U.S. crude stocks dropped by 3.3 million barrels to 418.3 million barrels according to the U.S. Energy Information Administration.

Expert TakeMike Sabo, market strategist at RJO Futures in Chicago, told Reuters the fear that "there’s a slowdown here" and also the potential for some additional supply increases "coming down the pike" is having some pressure on the market.

Posted In: EurasiaOilOPEC+West Texas IntermediateAsiaNewsCommoditiesMarketsMedia