Oil falls with economic slowdown fueling low demand concerns

By Zeynep Beyza Kilic

ANKARA (AA) - Oil prices started the week on a decline, with weak economic data from the US and China fueling low demand concerns in the world's largest oil consumers.

International benchmark Brent crude traded at $74.03 per barrel at 9.51 a.m. local time (0651 GMT), a 1.02% drop from the closing price of $74.79 a barrel in the previous trading session on Friday.

The American benchmark West Texas Intermediate (WTI) traded at the same time at $69.46 per barrel, down 1.01% from the previous session's close of $70.17 per barrel.

Concerns about a decline in global oil demand and a slowdown in economic growth weighed on prices.

In the US, economic growth has slowed in recent months due to high inflation and interest rates. Experts now await US consumer inflation data expected on Tuesday and the Fed's decision on interest rates due Wednesday.

Negative economic data from China, the world's largest importer of crude oil, also raised concerns about weakening demand.

According to China's National Bureau of Statistics, the producer price index decreased by 4.6% in April compared to the same period last year, while the consumer price index rose by 0.2%. Data showed a slower-than-expected recovery in China's economy since the lifting of COVID-19 restrictions.

In addition, Iran's message that it is open to an agreement with the West on its nuclear program also supported downward price movements.

Iran's Supreme Leader, Ayatollah Ali Khamenei, said Sunday that a nuclear deal with the West is welcome as long as the country’s nuclear industry infrastructure remains intact.

Khamenei's comments raised concerns that the balance in the oil market could be disrupted. Market players are concerned about Iranian oil flooding the market if sanctions are lifted on its crude oil exports.