Oil dips on demand concerns after IMF cuts growth outlook

By Rowena Edwards

LONDON (Reuters) -Oil costs slipped in unstable buying and selling on Tuesday as traders weighed demand considerations towards tight international provides after Libya halted some exports and as factories in Shanghai ready to reopen following a COVID-19 shutdown.

Brent crude was down $1.41, or 1.2%, to $111.75 a barrel at 1028 GMT, after rising greater than $1 to $114.21 earlier within the session.

U.S. West Texas Intermediate crude fell $1.64, or 1.5%, to $106.57 a barrel, after rising to $108.92 earlier.

Costs got here underneath stress with the greenback buying and selling at a recent two-year excessive. A firmer dollar makes commodities priced in {dollars} dearer for holders of different currencies, which might dampen demand. [USD/]

Considerations over demand development have been additionally in focus forward of the discharge of the IMF’s World Financial Outlook on Tuesday.

“Expectations are for decrease development forecasts because of the double whammy of the Ukrainian disaster and the continued coronavirus pandemic,” PVM analyst Stephen Brennock mentioned in a word.

U.S. crude oil inventories possible rose final week, whereas distillate and gasoline stockpiles have been seen down, a preliminary Reuters ballot confirmed on Monday.

China’s economic system slowed in March, worsening an outlook already weakened by COVID-19 curbs and the Ukraine struggle and including to demand considerations.

Nevertheless, gasoline demand in China, the world’s largest oil importer, may start to choose up as manufacturing crops put together to reopen in Shanghai.

The worth decline on Tuesday adopted an increase of greater than 1% on Monday, when oil costs hit their highest since March 28 on Libyan oil provide disruptions.

The nation’s Nationwide Oil Corp (NOC) warned on Monday of “a painful wave of closures” and declared drive majeure on some output and exports as forces within the east expanded their blockade of the sector over a political standoff.

Highlighting provide worries, the OPEC+ provide hole widened in March as sanctions hit Russian output.

The potential of a European Union ban on Russian oil for its invasion of Ukraine continued to maintain the market on edge. French Finance Minister Bruno Le Maire mentioned on Tuesday that an embargo on Russian oil at a European Union stage was within the works.

(Extra reporting by Mohi Narayan in New Delhi, Sonali Paul in Melbourne; Modifying by Bernadette Baum)