SINGAPORE: Oil prices dipped on Monday as rising trade tensions dented the outlook for fuel demand growth especially in Asia, although US sanctions against Iran still pointed toward tighter supply.
Front-month Brent crude oil futures were at $72.63 per barrel at 0509 GMT, down by 18 cents, or 0.25 percent from their last close.
US West Texas Intermediate (WTI) crude futures were at $67.63 a barrel, unchanged from their last settlement.
Signs of slowing economic growth and lower fuel demand increases, especially in Asia’s large emerging markets are weighing on the oil markets.
Singapore-based brokerage Phillip Futures said on Monday that “trade protectionism and escalating tensions between the world’s largest economies (The United States and China) have cast a looming shadow on global oil demand growth in 2018.”
Hedge funds and other money managers reduced their bullish positions in US crude futures and options in the week ending on Aug. 7, data from the US Commodity Futures Trading Commission showed on Friday.
Beyond the darkening economic outlook, Phillip Futures said hedge funds had reduced bullish bets because of “rising production levels from OPEC and the United States.”
US energy companies last week added the most oil rigs since May, adding 10 rigs to bring the total count to 869, according to the Baker Hughes energy services firm.
That was the highest level of drilling activity since March 2015.
Despite this cautious oil market sentiment, there are drivers that are keeping prices from falling further.
The United States has started implementing new sanctions against Iran, which from November will also target the country’s petroleum sector.
Iran is the third-largest producer among the members of the Organization of the Petroleum Exporting Countries (OPEC).
“With US sanctions on Iran back in place ... maintaining global supply might be very challenging,” ANZ bank said on Monday, although it added that “the US is doing its bit to increase production.
Oil prices dip as demand outlook dims
Oil prices dip as demand outlook dims
Closing Bell: Saudi main index closes in red at 10,947
RIYADH: Saudi Arabia’s Tadawul All Share Index dipped on Thursday, losing 208.20 points, or 1.87 percent, to close at 10,947.25.
The total trading turnover of the benchmark index was SR4.80 billion ($1.28 billion), as 14 of the listed stocks advanced, while 253 retreated.
The MSCI Tadawul Index decreased, down 25.35 points, or 1.69 percent, to close at 1,477.71.
The Kingdom’s parallel market Nomu lost 217.90 points, or 0.92 percent, to close at 23,404.75. This came as 24 of the listed stocks advanced, while 43 retreated.
The best-performing stock was Musharaka REIT Fund, with its share price up 2.12 percent to SR4.34.
Other top performers included Al Hassan Ghazi Ibrahim Shaker Co., which saw its share price rise by 1.18 percent to SR17.20, and Saudi Industrial Export Co., which saw a 0.8 percent increase to SR2.51.
On the downside, Abdullah Saad Mohammed Abo Moati for Bookstores Co. was among the day’s biggest decliners, with its share price falling 9.3 percent to SR39.
National Medical Care Co. fell 8.98 percent to SR128.80, while National Co. for Learning and Education declined 6.35 percent to SR116.50.
On the announcements front, Red Sea International said its subsidiary, the Fundamental Installation for Electric Work Co., has entered into a framework agreement with King Salman International Airport Development Co.
In a Tadawul statement, the company noted that the agreement establishes the general terms and conditions for the execution of enabling works at the King Salman International Airport project in Riyadh.
Under the 48-month contract, the scope of work includes the supply, installation, testing, and commissioning of all mechanical, electrical, and plumbing systems.
Utilizing a re-measurement model, specific work orders will be issued on a call-off basis, with the final contract value to be determined upon the completion and measurement of actual quantities executed.
The financial impact of this collaboration is expected to begin reflecting on the company’s statements starting in the first quarter of 2026, the statement said.
The company’s share price reached SR23.05, marking a 2.45 percent decrease on the main market.
