Metals News
Worries about demand prospects and pressure on inventory growth crude oil closed down under pressure
The content below was translated by Tencent automatically for reference.

SMM News: crude oil futures prices closed down on Monday as investors focused on market concerns about slowing global economic growth. And look for clues about what OPEC (OPEC) and its "allies" will do next to cut production. Meanwhile, US President Donald Trump said on the 7th that the United States had reached an agreement with Mexico to impose tariffs on Mexican exports to the United States, which at one point supported oil prices, Xinhua reported.

West Texas Light crude (WTI) futures for July delivery fell 73 cents, or 1.4 per cent, to $53.26 a barrel on the New York Mercantile Exchange. WTI futures prices rose 0.9% in overall trading last week, but slid into the bear market region in the middle of last week.

Meanwhile, North Sea Brent crude for August delivery on the ICE European Futures Exchange in London also fell $1, or 1.6 per cent, to close at $62.29 a barrel.

"after Mexico promised the Trump administration to expand its border program to slow immigration into the United States, the United States and Mexico reached an agreement to suspend tariffs, which provided a boost to the market." Phil Flynn, senior market analyst at Huili Futures Group (Price Futures Group), said. As a result, global stock markets, including the major U.S. benchmark stock indexes, rose on Monday, but that risk appetite did not provide much support for oil prices.

In terms of economic data, according to Xinhuanet, the General Administration of Customs released data on the 10th. In the first five months of this year, China's imports and exports of goods totaled 12.1 trillion yuan, an increase of 4.1 percent over the same period last year. Industry insiders believe that under the "headwind" of protectionism, China's foreign trade has "gone against the wind" and developed smoothly, which is the result of China's persistence in opening wider to the outside world, and has also injected more certainty into global trade. As a result, the Chinese stock market rose sharply. By the end of the day, the Prev index was up 0.86% at 2852.13 points, while the Shenzhen Composite Index was up 1.48% at 8711.79 points.

Over the weekend, the Saudi government hinted in a statement that OPEC and its partners were about to reach an agreement to extend existing production cuts beyond June. At the same time, the statement also mentioned the need to maintain the production reduction at the current level. " Analysts at JBC Energy, a Vienna-based energy consultancy, wrote in a research note. The report also pointed out that the decline in the number of crude oil rigs in the United States has also supported oil prices.

Baker Hughes (Baker Hughes), a field service provider, reported on Friday that the number of crude oil drills in the US fell 11 to 789 in the week, the biggest weekly drop since the week ending April 26. The report also pointed out that the number of crude oil wells in the United States has declined for four weeks in five weeks, the lowest level since February 2018. The BeckHughes data could provide clues to future US crude oil production, and a reduction in the number of drilling platforms means production could fall, which is usually a positive factor for oil prices.

It is unclear whether OPEC members and Russia and other non-OPEC oil producers will extend the agreement on production cuts. According to reports, Russian Energy Minister Alexander Novak (Alexander Novak) said on Monday that if the production reduction agreement is not extended, then he can not rule out the possibility of oil prices falling to $30 a barrel.

According to a survey by S & P Global P l a t t s), OPEC members produced 30.9 million barrels of crude oil a day in May. It hit its lowest level since February 2015, before Gabon, Equatorial Guinea and Congo joined OPEC. At that time, Qatar was still a member of the organization. Saudi Arabia's production fell to 9.7 million barrels a day, the lowest level since January 2015, while Iraqi production climbed to an all-time high of 4.82 million barrels a day, according to the survey.

In other energy trading on the New York Mercantile Exchange, RBOB gasoline futures for July delivery fell nearly 1 cent, or 0.5%, to close at $1.730 a gallon. Heating oil futures for July delivery fell 1.9 cents, or 1%, to $1.806 a gallon. Natural gas futures for July delivery rose 2 cents, or 0.9 per cent, to $2.357 per million British thermal units.

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