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Hazloc Heaters
Copper Tip Energy Services
Copper Tip Energy
Hazloc Heaters

Oil Slides Again as Trade War Pressures Outlook for Demand

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These translations are done via Google Translate

By Sharon Cho and Grant Smith

(Bloomberg) Oil held losses as the U.S. and China’s inability to agree on a schedule for talks deepened concern that their ongoing trade clash will further erode fuel demand.Brent futures for November slipped 0.7% in London after dropping 1% on Monday. Chinese and U.S. officials have yet to agree on the basic terms of re-engagement after the latest round of tariff increases, with mistrust on both sides, according to people familiar with the discussions. Crude output from OPEC rose last month for the first time since the group and its allies began a new round of cutbacks at the start of the year, a Bloomberg survey showed.

OPEC's production rose in August for the first time this year

“It is still all about the economy,” said Harry Tchilinguirian, head of commodity-markets strategy at BNP Paribas SA in London. “When it comes to U.S.-China trade tensions, any setbacks appear to lend support to the U.S. dollar and generate headwinds for commodities.”

Brent for November settlement fell 41 cents to $58.25 a barrel on the ICE Futures Europe Exchange as of 10:21 a.m. in London, after falling as much as 1.1% earlier. The contract lost 59 cents on Monday.

West Texas Intermediate for October delivery declined 62 cents, or 1.1%, from Friday’s close to $54.48 a barrel on the New York Mercantile Exchange. Trades made in Monday’s session will be booked for settlement on Tuesday because of the U.S. Labor Day holiday. The U.S. benchmark crude traded at a $4.02 discount to Brent for the same month.


Trade Standoff

The U.S. and China have failed to agree in the past week on at least two requests — an American appeal to set some parameters for the next round of talks and a Chinese call to delay new tariffs, said two of the people who asked not to be identified as the discussions are private.


Nigeria and Saudi Arabia led the increase in OPEC production last month, which was the first since the cartel and its allies started a new round of output cuts at the beginning of the year. OPEC is struggling to prop up crude prices as the escalating U.S.-China trade war weakens global demand and as American production continues to grow.

OPEC production fell by 200,000 barrels to 29.99 million barrels a day in August, according to a Bloomberg survey based on estimates from officials, ship-tracking data and consultants. The group and its partners — a 24-nation coalition known as OPEC+ — had agreed to cut output by 1.2 million barrels a day at the start of this year. Russia aims to “fully comply” with OPEC+ caps this month, according to an Energy Ministry statement.

Other oil-market news:
  • Saudi Arabia removed Energy Minister Khalid Al-Falih from his position as chairman of Saudi Aramco, the second time his role has been scaled back in less than a week, as the government prepares to sell shares in the state-owned oil company.
  • Venezuelan exports of crude, which bankrolls the regime of President Nicolas Maduro, slumped to a 16-year low in August as buyers including India’s Reliance Industries Ltd. curbed purchases.
  • The U.S. East Coast from Florida to the Carolinas is bracing for devastating winds and a life-threatening storm surge from Hurricane Dorian as the Category 3 storm wreaks havoc on the Bahamas.

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