Oil is moderately expensive on Tuesday morning.
The price of September Brent futures on London’s ICE Futures Exchange stands at $75.02 a barrel by 8:11 a.m., $0.37 (0.5%) above the previous session’s closing price. Those contracts fell $0.76 (1%) to $74.65 a barrel on Monday.
WTI futures for August crude oil grew by $0.36 (0.52%) to $70.15 per barrel at electronic trades on NYMEX. The day before these contracts went down by $0.85 (1.2%) to $69.79 per barrel.
On Monday, Saudi Arabia announced that it was extending its voluntary cut of oil production by 1 mln bpd for August. Thus, Saudi Arabia’s oil production will remain at around 9 million bpd in August.
Meanwhile, Russia, in an effort to balance the market, will voluntarily reduce supplies to oil markets by 500,000 bpd in August by reducing exports by a specified amount, Russian Deputy Prime Minister Alexander Novak told reporters.
Oil initially reacted to the news with moderate positivity, but it was not enough for a significant rally, Sevens Report Research analysts said.
A negative factor for the market was the news that the index of business activity in the U.S. manufacturing sector (ISM Manufacturing) fell to 46 points in June from 46.9 points a month earlier. Experts, the consensus forecast of which was quoted by Trading Economic, had expected the growth up to 47 points.
Meanwhile, the euro area manufacturing purchasing managers’ index (PMI) fell to 43.4 points this month, down from 44.8 points in May, according to final data from Hamburg Commercial Bank (HCOB) and S&P Global. Previously, it had reported a decline to 43.6 points. The final result indicates the sharpest deterioration in the sector since May 2020, Trading Economics wrote.
