Investing.com — Oil prices edged lower on Friday, pressured by expectations that OPEC+ will boost production in October, at a time when questions remain about the strength of the demand outlook.
At 2:30 PM ET (18:30 GMT), the price was down 3.3% at $73.45 per barrel, while the stock was down 2.5% at $76.83 per barrel.
Oil prices lose in August
US oil prices fell almost 6% in August as increased fears of a global economic slowdown hurt the demand outlook.
OPEC lowered its forecast for global oil demand growth in 2024, citing weaker-than-expected figures for the first half of the year and lower expectations for demand from China.
In addition to demand, supply concerns also weighed on sentiment, as there were fears that OPEC and its allies or OPEC+ could likely go ahead with their plans to ramp up production in October.
The strength of the dollar is contributing to the oil problems
A recovery in the economy also weighed on oil prices, as bets on a bigger rate cut in September were set aside after data showed rates slowed more than expected in July and remained robust.
Because oil is priced in dollars, a stronger dollar tends to make oil more expensive and less attractive to foreign buyers.
About 30% of traders now expect a 50 basis point rate cut in September, up from 37% last week, according to Investing.com.
Production cuts in Iraq and the closure of Libya are the basis for oil production
Oil prices were supported this week after Reuters reported that Iraq planned to cut its oil production in September as part of a plan with the Organization of the Petroleum Exporting Countries.
Iraq will cut production to between 3.85 million and 3.9 million barrels per day, after producing around 4.25 million barrels per day in July.
Production disruptions also persisted in Libya. Reports indicate that more than half of the country’s oil production was taken offline this week, amid a growing row over the leadership of the country’s central bank.
(Peter Nurse, Ambar Warrick contributed to this article.)
