Oil prices ease as traders weigh Middle East tensions, demand

Tuesday,   23-Jul-2019   09:09 AM (IST)

Oil prices inched lower on Tuesday as the International Energy Agency (IEA) said it would act quickly if needed to keep the market supplied amid tensions in the Middle East and traders eyed a weaker demand outlook. Brent crude (LCOc1) futures slipped 2 cents to $63.24 a barrel by 0121 GMT. The international benchmark rose more than 1% in the previous session, following Iran's seizure of a British tanker last week that stoked fears of supply disruptions from the energy-rich Gulf. West Texas Intermediate (WTI) crude (CLc1) futures were down 6 cents, or 0.11% at $56.16 per barrel. The International Energy Agency (IEA) said it was closely monitoring developments in the Strait of Hormuz. The potential for disruption in the Middle East has come amid a more fundamental souring of market sentiment in recent days, with hedge funds, producers and traders all taking a more bearish tack in response to what they see as weakness in worldwide demand. The Organization of the Petroleum Exporting Countries (OPEC) and some non-affiliated producers including Russia, known collectively as OPEC+, have withheld supplies since the start of the year to prop up prices. Adding to pressure on prices, Libya's National Oil Corp lifted a force majeure on loadings at the country's largest Sharara oilfield, which had been closed since Friday. Meanwhile, U.S. oil output from seven major shale formations is expected to rise by about 49,000 barrels per day (bpd) in August, to a record 8.55 million bpd, the U.S. Energy Information Administration said last week.