3-4 minutes - Source: CNBC
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Both Brent crude and U.S. West Texas Intermediate crude had risen by more than 1% earlier in the day, but by 1327 GMT Brent was down 64 cents, or 1.1%, at $57.71 a barrel and WTI was down 67 cents, or 1.3%, at $52.08.
Investors are treading cautiously before U.S.-China trade talks that take place in Washington on Thursday, though prospects for progress dimmed after U.S. President Donald Trump said a quick trade deal was unlikely.
Washington is also moving ahead with discussions over possible restrictions on capital flows into China, with a focus on investments by U.S. government pension funds, Bloomberg reported.
“The market’s focus remains on trade tensions and oil demand concerns, ignoring the elevated geopolitical tensions in the Middle East and lower OPEC production in September,” said UBS oil analyst Giovanni Staunovo.
“Growing recession risks have capped the upside of oil prices.”
Oil prices were also pressured by weak economic data after U.S. producer prices fell unexpectedly in September, weighed down by lower costs of goods and services, which could give the Federal Reserve room to cut interest rates again this month.
Crude inventories in the United States are expected to have grown for a fourth week while distillates and gasoline stocks are also likely to have fallen, a Reuters poll showed on Monday. 1/8EIA/S 3/8
However, protests in OPEC members Iraq and Ecuador threatened to disrupt their oil output and supported prices.
In Iraq, protests resumed overnight in Baghdad’s Sadr City district, though much of the country appeared quieter than it has been for a week.
“Unrest in Iraq gained a high profile at the start of October as a result of large protests in Baghdad,” RBC analyst Al Stanton said.
He said potential attacks by Turkey on Kurdish forces in northeast Syria could take place close to the Iraqi border, leading to “a refugee crisis that puts pressures on Kurdistans economy” and its oil production.
Turkey said it had completed preparations for a military operation in northeast Syria after the United States began pulling back troops.
Ecuador’s energy ministry said protests against austerity could reduce its oil output by 59,450 barrels per day.
Saudi Arabia reiterated on Tuesday that it was ready to meet global oil needs. Installations belonging to Saudi Aramco were attacked on Sept. 14, hitting output and triggering a spike in oil prices.