AP FILE PHOTO
NEW YORK, United States—Worries about excess oil supply and uncertain demand combined Monday to push oil prices lower for a second straight session.
Reports of rising output in both Iraq and Iran slowed the momentum that lifted oil prices to their highest level in 2016 last week, analysts said.
Iraqi exports hit a near-record 3.36 million barrels a day in April, Bloomberg News reported, estimating that Iran’s output during the month reached 3.5 million barrels per day, the most since December 2011.
“The petroleum markets have tipped to the downside in light May Day holiday trade on concern that OPEC production is on the rise,” Citi Futures analyst Tim Evans said.
Adding to the concerns, Chinese data showed factory activity slowed in April compared to the month before.
The oil price declines were appropriate because the rally in prices over the last month has not been justified, Kyle Cooper of IAF Advisors said.
The market “is giving back a little bit of what in my mind it shouldn’t have had in the first place,” he said.
US benchmark West Texas Intermediate for June delivery fell $1.14 to $44.78 a barrel.
In London, Brent North Sea oil for delivery in July shed $1.54 to $45.83 a barrel.
RELATED STORIES
Oil prices hit fresh 2016 highs, pass $47
Oil prices jump on report Saudi plans to reduce drilling