SEOUL: Oil prices fell more than 1 percent on Wednesday, weighed down by a weaker oil demand outlook and a rise in US crude inventories despite growing expectations of ongoing OPEC-led supply cuts.
Brent crude futures, the international benchmark for oil prices, were down 87 cents, or 1.4 percent, at $61.42 a barrel by 0231 GMT.
US West Texas Intermediate (WTI) crude futures were down 85 cents, or 1.6 percent, at $52.41 per barrel.
The US Energy Information Administration (EIA) cut its forecasts for 2019 world oil demand growth and US crude oil production in a monthly report released on Tuesday.
The EIA lowered its 2019 world oil demand growth forecast by 160,000 barrels per day (bpd) to 1.22 million bpd and wound back its forecast for 2019 US crude production to 12.32 million bpd, 140,000 bpd less than the May forecast.
A surprise increase in US crude stockpiles also kept oil prices under pressure.
“Investors have been concerned about the recent rise in stockpiles in the US,” ANZ bank said in a note.
US crude inventories rose by 4.9 million barrels in the week ended June 7 to 482.8 million barrels, according to data from the American Petroleum Institute (API) on Tuesday. That compared with analysts’ expectations for a decrease of 481,000 barrels.
Official data from the Energy Information Administration is due at 10:30 A.M. EDT (1430 GMT) on Wednesday.
Alongside concerns about rising supply, ongoing trade tensions between the United States and China, the world’s two biggest oil consumers, weighed on prices. US President Donald Trump said on Tuesday he was holding up a trade deal with China.
“Oil prices have struggled to retain bullish gains as traders stay cautious over heightened geopolitical risks and persistent weakness in the global economic backdrop,” said Benjamin Lu, commodities analyst at Phillips Future in Singapore.
With the next meeting of the Organization of the Petroleum Exporting Countries (OPEC) set for the end of June, the market is eyeing whether the world’s major oil producers would prolong their supply cuts.
OPEC, along with non-members including Russia in a group called OPEC+, have limited their oil output by 1.2 million bpd since the start of the year to prop up prices.
The Energy Minister for the United Arab Emirates Suhail Al-Mazroui said on Tuesday that OPEC members were close to reaching an agreement on continuing production cuts.
OPEC is set to meet on June 25, followed by talks with its allies led by Russia on June 26. But Russia suggested a date change to July 3 to 4, sources within the group previously told Reuters.
Oil falls 1% on weaker oil demand growth, surprise gain in US crude stocks
Oil falls 1% on weaker oil demand growth, surprise gain in US crude stocks
- The US Energy Information Administration lowered its 2019 world oil demand growth forecast by 160,000 barrels per day (bpd) to 1.22 million bpd
Cashless societies becoming worldwide trend
RABAT: Imagine carrying cash but being unable to use it. The problem is not with the money, the product, or even the customer — it is the store, confronting shoppers at the checkout with a sign declaring: “Card or digital payment only.”
According to Al-Eqtisadiah, this scenario is no longer a scene from a movie; it is increasingly common worldwide. Many societies are moving toward cashless systems, replacing paper and coin money, cheques, and promissory notes with digital wallets, bank cards, and smart payment apps.
Building cashless societies
Traditional money, whether coins or notes, is rapidly becoming a relic in some countries — particularly those that developed digital infrastructures and financial systems early to support cashless transactions. Payments are now made electronically through credit and debit cards, digital wallets, and other contactless methods.
According to a report by Zimpler, some societies have reduced cash transactions to just 5 percent of all payments. Almost everything, from taxi rides to a cup of coffee, and even donations at local churches, is paid digitally. In China’s Shandong province, even beggars carry containers with QR codes for digital donations.
Sweden leads the cashless movement, with 99 percent of transactions conducted digitally. The law allows businesses to refuse cash outright, limiting cash payments to just 1 percent of total transactions.
Even street vendors no longer accept coins or banknotes. This success stems from Sweden’s early adoption of digital infrastructure, including the launch and widespread promotion of the Swish app in 2012, which reshaped public perception of traditional money.
A global decline in cash
The shift away from cash is a worldwide trend, according to Visual Capitalist. Countries at the forefront include Finland, China, and South Korea, as well as Denmark, the UK, Australia, and the Netherlands.
In the Arab world, the UAE, Bahrain, Qatar, and Saudi Arabia are leading the way, though progress varies depending on each nation’s digital infrastructure.
Digital payments: benefits and risks
The move toward digital payments is no longer a projection of cashless advocates; it is a reality, confirmed by the British printing firm De La Rue.
Research firm Edison Group notes that the company now faces an uncertain future as digital adoption accelerates, after previously producing 36 percent of the world’s currency.
The appeal of digital payments lies in the advantages they offer users. Digital transactions eliminate theft risks, prompting widespread adoption. For example, a late-night robbery in south London led a restaurant owner to stop accepting cash altogether.
Electronic money provides speed and convenience while protecting users from counterfeit notes, loss, damage, and other risks that threaten traditional cash. Governments also benefit, reducing printing costs, limiting visible tax evasion, and making money laundering easier to trace.
The figurative sentence, “Cash has become like a dinosaur, but it will remain,” is often cited by experts and financial consultants who question the notion of the “death of cash,” seeing it as a slogan promoted by major corporations to convince people that digital money is the currency of the present and future.
