Written by Florence Tan
SINGAPORE (Reuters) – Oil prices fell slightly on Monday on hopes of tight supply amid OPEC+ production cuts, attacks on Russian refineries and strong Chinese manufacturing data. and maintained most of its recent gains.
Brent crude fell 17 cents, or 0.2%, to $86.83 a barrel by 0017 GMT, after rising 2.4% last week. US West Texas Intermediate crude oil fell 11 cents, or 0.1%, to $83.06 a barrel, following a 3.2% rise last week.
Trade volumes are expected to be low on Monday due to Easter holidays in several countries.
Both indexes rose for the third consecutive month, with Brent crude hovering above $85 a barrel since mid-March, as the Organization of the Petroleum Exporting Countries and its allies known as OPEC+ pledged to extend production cuts until the end of June. are doing. Oil supplies could be tight in the Northern Hemisphere during the summer.
Russian Deputy Prime Minister Alexander Novak said on Friday that the country's oil companies would focus on production cuts rather than exports in the second quarter to spread production cuts evenly with other OPEC+ members.
Drone attacks are expected to destroy several Russian refineries and reduce Russian fuel exports.
“Geopolitical risks to crude oil and heavy feedstock supplies further strengthen demand fundamentals in 2Q24,” Energy Aspect analysts said in a note.
The consultancy said the attack had disrupted nearly 1 million barrels of Russian crude oil processing capacity per day, impacting exports of high-sulfur fuel oil processed at refineries in China and India. added.
Goldman Sachs analysts said European oil demand was stronger than expected, increasing by 100,000 barrels a day in February from a year earlier, compared to expectations for a contraction of 200,000 barrels a day.
The sources said in a note that strong European demand, slowing U.S. supply growth, and the possibility that OPEC+ production cuts may be extended through 2024, pose downside risks from continued weakness in Chinese demand. He pointed out that it exceeds the
“We believe our forecast for Brent crude oil prices to average $83/bbl in the fourth quarter of 2024 is risky and biased slightly to the upside,” the analysts said.
Still, manufacturing activity in China expanded for the first time in six months in March, an official factory survey showed on Sunday, even as the real estate sector crisis remains a drag on the economy, making it the world's biggest oil importer. It was shown that the demand for oil is underpinned by the demand for oil.
Investors are also looking at U.S. economic data for signs that the Federal Reserve will cut interest rates this year to support the global economy and oil demand.
(Reporting by Florence Tan; Editing by Himani Sarkar)
