Oil prices declined during U.S. trading on Monday, resuming their downward trend after a brief pause on Friday, as they remain pressured by news of Saudi Arabia’s potential production increase in December.
Additionally, oil prices are being weighed down by concerns over weak global demand, driven by China’s faltering economy and the prospect of an oversupply.
Prices
U.S. crude dropped 1.4% today, settling at $67.60 per barrel, after peaking at $69.28 earlier in the session.
Brent crude fell 1.2%, reaching $71.07 per barrel, with an intraday high of $72.75.
On Friday, U.S. crude gained 1.8%, while Brent rose 0.85%, recovering from two-week lows and marking their first gains in three days.
Last week, oil prices declined by an average of 3.75%, registering their first weekly loss in three weeks.
Saudi Production
According to the Financial Times, Saudi Arabia is reportedly willing to abandon its unofficial $100 per barrel price target.
Sources indicate that Saudi officials are inclined to increase oil production in December, even if it results in a prolonged period of lower prices.
Libyan Production
Oil prices are also under pressure amid expectations of a sharp rise in Libyan crude output in the coming weeks, as warring factions move closer to appointing a new central bank governor.
Quarterly Performance
Oil prices have dropped an average of 16.5% this quarter, on track for their second consecutive quarterly decline.
Chinese Demand
A memo from Goldman Sachs forecasts a significant slowdown in Chinese oil demand as the country shifts towards natural gas and electric vehicles.
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