SINGAPORE – Oil prices dipped for a second session on Monday after Libya resumed production over the weekend while China, the world’s largest crude importer, is expected to release economic data showing that its post-pandemic recovery is fizzling out.
Brent crude futures fell 57 cents, or 0.7 percent, to $79.30 a barrel by 0055 GMT while U.S. West Texas Intermediate crude was at $74.90 a barrel, down 52 cents, or 0.7 percent.
Prices softened after both benchmarks last week notched a third straight week of gains and touched their highest levels since April when output was shut at oilfields in Libya and Shell halted exports of a Nigerian crude, tightening supply.
Two of the three Libyan oilfields shut on Thursday, the Sharara and El Feel oilfields with a total production capacity of 370,000 barrels per day (bpd), resumed on Saturday evening, four oil engineers and oil ministry said.
The 108 field remained shut. Output was halted in protest against the abduction of a former finance minister.
In Russia, oil exports from western ports are set to fall by some 100,000-200,000 bpd next month from July levels, a sign Moscow is making good on its pledge for fresh supply cuts in tandem with OPEC leader Saudi Arabia, two sources said on Friday, citing export plans.
On the economic front, stronger-than-expected consumer sentiment data in the U.S. on Friday dampened expectations that the Federal Reserve was set to end its rate hiking cycle at next week’s Federal Open Market Committee (FOMC) meeting, IG analyst Tony Sycamore said.
There is also some nervousness among traders ahead of another big week ahead for economic data from China, the UK and Japan, he added.
“All three of these readings will play a part in determining what the next move is for three key central banks the PBOC, BoE and the BoJ and by extension whether oil demand will receive a boost,” Sycamore said.
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