Oil prices creep lower on high stocks, weak China factories survey

Oil prices edged down on Monday, undermined by a weak manufacturers survey out of China, and despite talk that OPEC- led crude oil output cuts could be extended when oil producers meet later in May.

US benchmark crude oil for June delivery was down $ 0.19 at $ 49.14 a barrel by 6: 07 pm Beijing time.

A faster- than- expected slowdown of growth in China’s manufacturing sector in April also weighed on oil prices.

An official survey showed on Sunday that producer price inflation cooled and policymakers’ efforts to curtain financial risks in the economy weighed on demand.

“The moderation in the China PMI could see commodity prices come under some modest pressure,” ANZ said in a note.

It was the third consecutive week that the oil prices have opened lower. Inventories remain high, and the market remains stuck in the same rut it fell into in 2014, when a global glut fully emerged.

Iran’s oil minister said on Saturday that OPEC and non- OPEC countries had given positive signals for an extension of output cuts, which Tehran would also back.

The Organization of the Petroleum Exporting Countries ( OPEC) meets in May to discuss oil supply policy.

If OPEC agrees to extend the cuts, then bloated global inventories could drain by the end of 2017, according to a Reuters poll of economists and analysts.

Saudi Arabia’s Energy Minister Khalid al- Falih said on Saturday that there was consensus with Central Asia over oil markets and production levels.

Money managers cut their net long US crude futures and options positions for the first time in four weeks in the week ending April 25, the US Commodity Futures Trading Commission said on Friday.