Oil is steady as trade spat counters anxiety about global growth

Singapore — Oil prices dipped slightly on Monday on the concern that a US-China trade dispute will erode global economic growth, although looming US sanctions against Iran’s oil sector kept crude from falling further, traders said.

International Brent crude oil futures were at $75.75 a barrel at 1.22am GMT, down 7c from their last close.

US West Texas Intermediate (WTI) crude futures were down 9c at $68.63 a barrel.

“Falling US rig counts and last week’s decline in US inventories are supporting oil prices amid a protracted US-China trade war that could dampen global growth and weigh on oil demand,” said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.

US energy companies cut nine oil drilling rigs last week, dropping to 860, the biggest reduction since May 2016, energy services firm Baker Hughes said on Friday.

“Despite growing concerns about potential oversupply, the markets will continue to get a fillip from US sanctions against Iran,” Innes said.

Washington will target Iran’s oil exports with sanctions from November.

Opec-member Iran has exported around 2.5-million barrels a day of crude oil so far in 2018. Most analysts expect this figure to fall by at least 1-million barrels a day once sanctions kick in.

Reuters