Investing.com – The International Energy Agency (IEA) isn’t giving the oil selloff any reprieve as the market continues its slump on the notion that crude prices have gone up too much, too soon.
IEA chief Fatih Birol told an energy conference in Singapore earlier Tuesday that high oil prices were hurting consumers and could dent fuel demand at a time of slowing global economic activity. The IEA is the Western world’s energy watchdog.
“There are two downward pressures on global oil demand growth. One is high oil prices, and in many countries they’re directly related to consumer prices. The second one is global economic growth momentum slowing down,” Birol said.
Oil prices, already down since Monday on worries the market may have overestimated the impact to crude supplies from sanctions against Iranian oil beginning this Sunday, extended their losses on the IEA’s latest assessment.
Adding to the bearish sentiment, some traders said, were reports the Trump administration was preparing to put tariffs on another $257 billion of Chinese imports not yet covered in the trade war between the two countries.
By 12:45 PM ET (16:30 GMT), U.S. West Texas Intermediate () crude was down 74 cents, or 1.1%, at $66.30 per barrel. It was headed for a near-10% drop on the month after a 5% gain in September.
U.K. , the international benchmark for oil, was down $1.20, or 1.6%, at $76.14. It was set to lose almost 8% in October after a 7% rise last month.
Since President Donald Trump rescinded Iran’s nuclear deal with the West in May and reinstated sanctions on the world’s fourth-largest oil exporter, there’s been doubts he could bring the Islamic republic’s oil sales to zero as he vowed.
That pessimism was reinforced at the weekend after Iran’s oil ministry said it has started selling crude oil to private companies in the country for export as part of a strategy to counter the sanctions.
Other major importers of Iranian crude such as the EU and India are also looking for ways around the U.S. sanctions.
Refinitiv Eikon data distributed by Reuters on Tuesday showed that cumulative oil production by Russia, the United States and Saudi Arabia reached 33 million barrels per day (bpd) for the first time in September.
That’s an increase of 10 million bpd since the start of the decade, meaning the three producers alone now meet a third of global crude demand, the data showed.
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