Oil prices fell on Monday as worries about inflation, the global economy, and fuel demand prospects outweighed optimism over tighter supplies due to OPEC+ supply cuts.
By 9.48 a.m. Bangkok time, Brent crude lost 71 cents, or 0.87%, to $80.95 per barrel, while U.S. West Texas Intermediate crude was at $77.15 per barrel, dropped 73 cents, or 0.94%.
For the first time in five weeks, both contracts fell by more than 5% as weakening U.S. indicated gasoline demand added to fears of a recession in the world’s largest oil consumer.
According to CMC Markets analyst Tina Teng, growth worries and risk aversion among investors were spurred by weak U.S. economic data and poor corporate profits from the tech sector. She also noted that the commodity markets are feeling the effects of a strengthening U.S. dollar and rising bond yields.
Although Chinese customs statistics revealed high crude imports in March, China’s economic rebound after COVID-19 clouded its oil demand outlook.
Analysts and traders were optimistic about China’s gasoline demand recovery in the second half of 2023 and OPEC+’s May supply curbs, which might tighten markets.