Oil prices fell during Asian trading hours on Monday as analysts have expected a weaker demand from China in the approaching months.
The lowering consumption from China has caused worry in the global energy sector, where oil prices have nearly halved from the same period a year earlier due to oversupply and reduced demand.
At 0751 GMT, Brent futures LCOc1 was down by 6 cents at $49.50 a barrel, whilst CLc1 fell by 15 cents to $46.44 per barrel.
Commodities analyst, Hong Sung Ki, at Samsung Futures Inc has said;
“China’s manufacturing sector, which is still in contraction, is adding downward pressure on oil as it’s closely related to demand for oil products,”.
Data from other Asian economies remains mixed with improved data from Japan, Asia’s second biggest oil consumer and economy. Data from South Korea and Taiwan looks to further slowdown.
Considering supply; Russia’s output has increased since September with an increase of 40,000 barrels per day. Iran also has plans to increase output by 500,000 barrels a day, however this will not affect decline due to the market already accounting for the added barrels.
