(LONDON) Oil prices fell slightly on Monday without breaking the symbolic $80 a barrel mark for Brent as most of the gains after OPEC production cuts evaporated amid fears over the economy world.
Around 6 a.m. (Eastern time), a barrel of Brent from the North Sea for delivery in June yielded 0.39%, to 81.34 dollars.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery the same month dropped 0.26% to 77.67 dollars.
“The prospects for weaker economic growth have an effect on global oil demand expectations,” summarizes Ricardo Evangelista, analyst at ActivTrades.
As inflation persists around the world, investors are increasingly anticipating that monetary policies will be tightened further, which is weighing on the economy and therefore on the appetite for crude.
In this context, prices are sagging after their surge recorded in early April, when several members of the Organization of the Petroleum Exporting Countries and their allies (OPEC+) announced voluntary production cuts.
Compared to their level at the end of March, just before the announcements of production cuts, Brent gained 1.95% and WTI 0.95%.
ING analysts note, however, that demand persists, particularly in India, where imports have increased last year and in recent months.
“Local refineries processed a record 23,000 tons in March, a slight increase of 3% year-on-year,” they comment.
And China, the world’s biggest importer, could see its consumption increase as the Golden Week holiday takes place next week, encouraging travel within the country.
Thursday’s US growth data could also influence demand forecasts from the world’s largest consumer of black gold.