Oil falls as demand prospects hurt by trade war fears

 

 By Alexander James          August 6, 2019

Brent crude futures fell more than three percent on Monday on concerns about global growth.

Brent crude fell $2.08, or 3.36 percent, to $59.81 a barrel.

West Texas Intermediate futures fell 97 cents, or 1.74 percent, to $54.69 a barrel, as it received some support from a drop in inventories at the U.S. crude delivery point in Cashing, Oklahoma.

Traders, citing data from Market Information Company, said stocks in Cushing fell by about 2.4 million barrels in the week ending August 2.

The benchmark crude slumped more than seven percent last Thursday to nearly seven weeks after Trump's announcement, before recovering some of its recovery, with Brent down 2.5 percent over the week and U.S. crude down 1 percent.

Trade war concerns hurt global markets again on Monday, while supporting the rise of safe assets such as the Japanese yen, major government bonds and gold.

Trump said last week that he would impose a 10 percent fee on Chinese imports worth $300 billion from September 1.

He suggested that tariffs could increase further if Chinese President Xi Jinping did not move faster towards trade agreement.

Yesterday, China left the yuan falling to a weaker level of $7 for the first time in more than a decade.

The depreciation of the yuan would increase the cost of China's dollar-denominated oil imports. Beijing is the world's largest oil importer.

Prices were also under pressure due to signs of a rise in U.S. oil exports.

U.S. Census Bureau data on Friday showed the country's oil exports rose by 260,000 barrels per day in June to a monthly record of 3.16 million barrels per day.