Oil prices dropped on Monday, as weak manufacturing data from China and Japan for July weighed on the outlook for demand, while investors braced for this week’s meeting of officials from OPEC and other top producers on supply adjustments.
Brent crude futures were down $1.19 at $102.78 a barrel while US West Texas Intermediate crude was at $97.19 a barrel, down $1.43.
Fresh COVID-19 lockdowns snuffed out a brief recovery seen in June for factory activity in China, the world’s largest crude oil importer.
The Caixin/Markit manufacturing purchasing managers’ index (PMI) eased to 50.4 in July from 51.7 in the previous month, well below analysts’ expectations, data showed on Monday.
Japanese manufacturing activity expanded at its weakest rate in 10 months in July, data showed on Monday.
Brent and WTI ended July with their second straight monthly losses for the first time since 2020, as soaring inflation and higher interest rates raise fears of a recession that would erode fuel demand.
The Organization of the Petroleum Exporting Countries (OPEC)and allies including Russia, a group known as OPEC+, will meet on Wednesday to decide on September output.
Two of eight OPEC+ sources in a Reuters survey said a modest increase for September would be discussed at the Aug. 3 meeting, while the rest said output would likely be held steady.