Oil Holds Losses As Slipping Equities Vie With Stockpiles, Libya

(Bloomberg) -- Oil steadied after a two-day drop, with stock market losses offsetting a drawdown in US stockpiles and supply disruptions in Libya.

Brent traded below $79 a barrel after losing more than 3% over the previous two sessions, and West Texas Intermediate was near $75. Stocks in Asia slipped after Nvidia Corp. earnings lacked a wow factor to impress investors. Meanwhile, Goldman Sachs Group Inc. and Morgan Stanley have cut their 2025 oil price forecasts this week, with both expecting a surplus next year as China's recovery loses steam.

Global benchmark Brent is on track for a small decline in August even after repeated drops in US stockpiles, heightened tensions in the Middle East and, most recently, a more than halving of Libya's oil output. No. 1 importer China is seen missing its 5% GDP growth target this year, according to a Bloomberg survey, undermining demand in Asia's biggest economy.

“Demand concerns from mainland China also continue to cloud oil markets, especially as no credible signs of recovery are witnessed,” said Priyanka Sachdeva, a senior market analyst at brokerage Phillip Nova Pte in Singapore. Still, “Libyan disruptions amid geopolitical risks will continue to keep oil markets on edge,” she said.

Crude is still modestly higher for the year as expectations of lower interest rates in the US and OPEC+ supply discipline counter lackluster Chinese demand. The specter of the cartel boosting supply from October is hanging over the market, however. Traders are split on whether the planned increases will go ahead, according to a Bloomberg survey.

More stories like this are available on bloomberg.com

©2024 Bloomberg L.P.