ALBAWABA – Oil prices slipped only slightly in Asian trade Monday in anticipation of fresh economic data from top oil consumers, the United States (US) and China, with supply cuts from Saudi Arabia and Russia bolstering crude prices.
Brent crude futures fell 0.7 percent to $77.92 a barrel by 0630 GMT, according to Reuters, and US West Texas Intermediate crude settled at $73.31 a barrel, also down 0.7 percent.
The oil benchmarks gained more than 4 percent last week to touch their highest marks since May.
But concerns over declining demand from the US and China, in light of recent economic data, and upcoming reports this week, weighed on oil prices.
Meanwhile, pledges by Saudi Arabia and Russia to deepen supply cuts in August helped bolster Brent crude prices, according to Reuters, limiting losses.
"Oil traders may be cautious ahead of the US CPI [consumer price index] and China's slew of economic data later this week," CMC Markets analyst Tina Teng told Reuters.
However, crude prices could rebound after the Organization of Petroleum Exporting Countries and their allies (OPEC+) announced plans to further reduce supply, she added.
China's factory-gate prices fell at the fastest rate in over seven years last month.
Government data, issued Monday, showed signs of the momentum of economic recovery in the world's second-largest economy slowing.
"The presence of economic slowdowns in China adds to the prevailing uncertainty in the oil market," Mukesh Sahdev, head of downstream and oil trading at Rystad Energy, told Reuters.
"The market's instability is further fueled by the ongoing tug-of-war between fears of demand control by Western economies and the supply-control strategies employed by OPEC, which impacts the oil market's delicate balance."
Saudi Arabia will extend its 1 million barrels per day (bpd) output cut into August and Russia will cut crude exports by 500,000 bpd.
Nonetheless, instead of cutting output, Russia will be using the crude to produce more fuel to meet domestic demand, a government source told Reuters on Friday.
