On Monday, Oil steadied trading below $69 a barrel as distress over the U.S. and China trade dispute and worldwide economic outlook offset support from Mideast tensions as well as supply cuts.
Numbers showed that the profits for industrial companies of China shrank in the month of April. The new orders for the United States made capital products fell more than predicted in an additional sign that the economy is slowing down.
Olivier Jakob, who is a Petromatrix oil analyst said, “The main reason that is preventing crude prices from rising is the concern about the global economy. The macroeconomic outlook does not seem to be good”.
The global benchmark, Brent crude, was up 5 cents at $68.74 a barrel by 0839 GMT and last week falls by about 4.5%. There is down in Intermediate crude of 36 cents at $58.27 in U.S. West Texas.
The biggest weekly price decline of the year was registered by both crude contracts last week. On Monday, in the United States and Britain Public holidays limited participation by keeping the volumes low.
By deploying more troops to the Middle East, the rising tension between the United States and Iran has little effect on the market so far.
On Friday, the U.S. Commodity Futures Trading Commission (CFTC) said that the Money managers cut their net long United States crude futures as well as options positions bets on increasing prices in the week to May 21.
The OPEC (Organization of the Petroleum Exporting Countries) and allies together with Russia identified as OPEC+, has been cutting supply for tightening the market in an efficient manner. United States sanctions on OPEC members Venezuela and Iran have curbed their crude exports by reducing supplies.
Besides, suggesting a tight balance between supply and demand the Brent’s price structure remains in backwardation with rates for on-time delivery higher than those for future dispatch.
