Oil prices fell by up to one percent in Asian trading on Tuesday, extending their losses after reaching their lowest levels in four months recorded in the previous session, amid investors’ concerns about rising supplies later in the year amid indications of weak US demand.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, known as OPEC+, agreed on Sunday to extend most oil production cuts until 2025, but left room to gradually phase out voluntary cuts by eight members starting from October onwards.
With manufacturing activity in the United States slowing for the second consecutive month in May, and unexpected declines in construction spending in April, these indicators suggest further economic weakness that could lead to lower oil prices, paving the way for a retest of the minimum range at $72.00 per barrel.
Signs of weak demand growth have affected oil prices in recent months, with a focus on data related to fuel consumption in the United States. The average price of gasoline in the United States fell by 5.8 cents per gallon to $3.50 per gallon on Monday, with the US government scheduled to release inventory and supply data on Wednesday.
