Oil prices slump, global growth concerns

Tuesday was the second day that oil prices again showed signs that global economic growth is being hit by the US trade war, though losses were limited by tensions in the Middle East after the last week’s tanker attacks.

Brent’s raw earnings were down 40 cents, or 0.7 percent, to $ 60.54 per barrel up to 0701 GMT. They fell 1.7% in the previous session for worries about the slowdown in global growth.

Western American West Midwest’s income was down 28 cents, or 0.5%, to $ 51.65. They dropped 1.1% on Monday.

New York Federal Reserve said the New York City business growth rate posted a record decline this month at the weakest level in more than 2-1 / 2 years, suggesting a sudden contraction in regional activity .

The American business sentiment has been interrupted as trade tensions escalated between China and the United States and the signs of softness in the labor market.

Stephen Innes, the leading partner at Vanguard Markets in Bangkok, said, “The oil market is on the way and desperately needs some robust economic data to get it out of this job.”

Since April 2019, oil prices have fallen by about 20%, partly due to concerns about US trade war and disappointing economic data.

US President Donald Trump and China’s Xi Jinping may meet at the G20 summit in Japan later this month. Trump has said he will meet with Xi at this event, although China has not confirmed the meeting.

By putting pressure on the oil, the US energy department said on Monday that shale oil production is expected to reach a record in July.

But analysts said that tensions in the Middle East are likely to keep up the price.

Patrick Shanahan, the acting secretary of the US Defense Secretary on Monday, announced the deployment of some 1,000 other troops to the Middle East for what he said were defensive purposes, citing concerns about a threat from Iran.

Last Thursday there has been a fear of a confrontation between Iran and the United States, when two oil tankers boomed that Washington had blamed on Tehran. Iran has denied involvement.

Khalid al-Falih, Saudi Arabian energy minister, said Monday that countries should cooperate in maintaining open air lines for oil and other supplies of energy to secure sustainable supplies.

Market participants are also awaiting a meeting between the Organization of Petroleum Exporting Countries and other producers including Russia, a group known as OPEC +, to decide whether to extend a shortened production agreement that expires this month .

Al-Falih said the meeting is likely to be held the week after the G20 summit in Osaka on 28-29 June.

He also said Saudi exports and production are expected to be “around the same level as in recent months.”/Investing.com

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