By Florence Tan
SINGAPORE, April 24 (Reuters) - Oil prices slipped on
Monday as concerns about rising interest rates, the global
economy and the outlook for fuel demand outweighed support from
the prospect of tighter supplies on OPEC+ supply cuts.
Brent crude slipped 48 cents, or 0.6%, to $81.18 a
barrel by 0045 GMT while U.S. West Texas Intermediate crude was at $77.39 a barrel, down 48 cents, also 0.6% lower.
Both contracts fell more than 5% last week, their first
weekly drop in five, as U.S. implied gasoline demand fell from a
year ago, fuelling worries of a recession at the world's top oil
consumer.
Weak U.S. economic data and disappointing corporate earnings
from the tech sector sparked growth concerns and risk aversion
among investors, CMC Markets analyst Tina Teng said. The
stabilising U.S. dollar and climbing bond yields are also
pressurising commodity markets, she added.
Central banks from the United States to Britain and Europe
are all expected to raise interest rates when they meet in the
first week of May, seeking to tackle stubbornly high inflation.
China's bumpy economic recovery post COVID-19 also clouded
its oil demand outlook, although Chinese customs data showed on
Friday that the world's top crude importer brought in record
volumes in March. China's imports from top suppliers Russia and
Saudi Arabia topped 2 million barrels per day (bpd) each.
Still, refining margins in Asia have weakened on record
production from top refiners China and India, curbing the
region's appetite for Middle East supplies loading in June.
Nevertheless, analysts and traders remained bullish about
China's fuel demand recovery towards the second half of 2023 and
as additional supply cuts planned by OPEC+ - the Organization of
the Petroleum Exporting Countries and allied producers including
Russia - from May could tighten markets.
"China's oil demand recovery is expected to more than offset
the slowdown in OECD demand in the near term, while sanctions
and supply constraints add upside risk to prices," analysts at
the National Australia Bank said, adding that Brent could rise
to $92 a barrel by the end of the second quarter.
In the United States, energy firms last week added oil and
natural gas rigs for the first time in four weeks, energy
services firm Baker Hughes Co said. (Reporting by Florence Tan; Editing by Kenneth Maxwell)
florence.tan.thomsonreuters.com@reuters.net))
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