Oil prices decline due to potential relief in tight supply concerns

Shafaq News / Oil edged lower on Tuesday as the market waited to see if Iraqi oil exports resume, which could ease the supply tightness caused by the OPEC+ cut, while a faltering Chinese economy continued to undercut the global demand outlook.

Brent crude was down 8 cents at $84.38 a barrel and U.S. West Texas Intermediate crude was trading 7 cents lower at $80.65 a barrel at 0241 GMT. WTI’s contract with September expiry slipped 8 cents at $80.04 a barrel.

“Crude oil struggled to keep its head above water on signs of supply tightness easing,” said Brian Martin and Daniel Hynes, analysts from ANZ Bank in a note to clients.

Iraq’s oil minister Hayan Abdel-Ghani arrived in the Turkish capital Ankara to discuss several issues including the resumption of oil exports through the Ceyhan oil terminal, a source in the minister’s office told Reuters on Monday.

Turkey halted Iraq’s 450,000 barrels per day (bpd) of exports through the northern Iraq-Turkey pipeline on March 25 after an arbitration ruling by the International Chamber of Commerce (ICC).

More Iraqi crude oil coming on to the market could help alleviate the supply crunch for sour crude as the Organization of the Petroleum Exporting Countries and the allies (OPEC+) prolonged and deepened production cuts.

Meanwhile, gloom over the economic outlook in China, the world’s second biggest oil consumer, continued to pressure oil prices and heighten worries about fuel demand.

(Reuters)