Oil prices rise amid OPEC supply cuts, but trade worries weigh

Oil prices rose as ongoing supply cuts led by producer club OPEC kept markets relatively tight, but Brent remained below $70 per barrel on concerns over an ongoing trade war between the United States and China.

Front-month Brent crude futures, the international benchmark for oil prices, were at $69.10 per barrel, up 41 cents, or 0.6 percent, from their last close. US West Texas Intermediate (WTI) crude futures were up 10 cents, or 0.2 percent, at $58.73 per barrel.

A group of producers

led by the Organization of the Petroleum Exporting Countries (OPEC), known as OPEC+, has been withholding supply since the start of the year to tighten the market and prop up prices.

But the gain could not make up for falls last week, when both crude futures contracts registered their biggest price declines this year amid concerns that the Sino-american trade dispute could accelerate a global economic slowdown.

Beyond financial markets, there are also signs on the ground of a slowdown in oil demand growth.

China’s automobile sales, a key driver of global oil demand growth, will reach around 28.1 million units this year, unchanged from levels seen in 2018, when the country’s auto market contracted for the first time in more than two decades, state news agency Xinhua reported.

The outlook for flat car sales may be too optimistic still, as monthly sales have so far declined for 10 consecutive months.

A bright spot for carmakers, although not for the oil industry, is that sales of new energy vehicles are likely to grow by about 27 percent to hit 1.6 million units, from 1.26 units in 2018, the report said.