Fundamental Comment

Oil prices fall amid fears of sluggish global demand

Oil prices fall amid fears of sluggish global demand

Oil prices fell during Tuesday's trading session, amid fears of slowdown in global demand after the release of dismal manufacturing reports overshadowed uncertainty surrounding resumption of oil supplies from Saudi Arabia.

As of 07:50 GMT, Brent crude oil futures plunged 1.02 percent at $64.10 a barrel, where the session's lowest level was hit at $63.77 a barrel,

West Texas crude was 0.94 percent down at $58.09 a barrel after the prices opened at $58.17 a barrel.

Economic data yesterday revealed that Germany’s manufacturing sector contracted at the lowest level in 10 years in September, recording 41.4 from 43.5 in August, according to the Preliminary PMI figures.

In Japan, the manufacturing sector shrank at the fastest pace in seven months in September, where it dropped to 48.9 from 49.3 in August.

According to some reports, that Saudi Arabia has recovered more than 75 percent of the loss of crude production after attacks on two of its facilities and that it will return to full quantities by early next week.

On the contrary, some newspapers said that repairs to the two facilities might take months longer than expected.

Meanwhile, the American Petroleum Institute is scheduled to release preliminary U.S. crude inventories data for the past week later in the day.

The EIA government report due on Wednesday may show U.S. crude stockpiles slipped 0.5 million barrels the previous week after a 1.1-million-barrel increase a week before.

The U.S dollar index, which tracks the green currency’s performance versus a basket of six major currencies, traded lower ahead of U.S. consumer confidence due at 14:00 GMT.

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