London — Oil prices gave up the previous day’s gains on Tuesday on a weaker demand outlook and global oil oversupply risks that continue to weigh on the market.
Providing a floor for prices were U.S. supply disruptions from Tropical Storm Francine.
Brent crude futures were down 48 cents, or 0.67%, at $71.36 a barrel at 1317 GMT. U.S. West Texas Intermediate crude lost 42 cents, or 0.6%, to $68.29.
Both benchmarks had risen about 1% on Monday.
The Organization of the Petroleum Exporting Countries (OPEC) forecast in a monthly report on Tuesday that global oil demand would rise by 2.03 million barrels per day (bpd) in 2024, down from previously projected growth of 2.11 million bpd.
OPEC also cut its 2025 global demand growth estimate to 1.74 million bpd from 1.78 million bpd.
The weakening global demand prospects and expectations of oil oversupply kept the market suppressed.
Chinese data on Monday showed consumer inflation accelerated in August to its fastest in half a year, though domestic demand remained fragile, and producer price deflation worsened.
And while data released on Tuesday showed China’s exports grew at their fastest in nearly 1-1/2 years in August, imports disappointed against a backdrop of depressed domestic demand.
“The message from China is simple but loud and reverberates throughout the globe,” said PVM Oil analyst Tamas Varga, adding that the country is struggling to encourage spending and boost sluggish demand.
Meanwhile, the U.S. Coast Guard ordered the closure of all operations at Brownsville and other small Texas ports on Monday evening as Tropical Storm Francine barrelled across the Gulf of Mexico. Corpus Christi port remained open with restrictions.
The tropical storm is forecast to strengthen significantly and become a hurricane on Tuesday, according to the National Hurricane Center (NHC).
Exxon Mobil said it shut in output at its Hoover offshore production platform while Shell paused drilling operations at two platforms. Chevron also began shutting in oil and gas output at two of its offshore platforms.
The U.S. Energy Information Administration is due to publish its short-term energy outlook, with forecasts for the global market and U.S. crude oil output.
*Ahmad Ghaddar, Katya Golubkova & Florence Tan & Arunima Kumar, editing: David Goodman & Mark Potter – Reuters
