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Oil prices fall as U.S. fuel demand remains weak

Published 05/29/2020, 09:10 AM
Updated 05/29/2020, 09:20 AM
© Reuters.
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* Crude, distillates stocks rise last week -EIA
* OPEC+ considers extending 9.7 mln bpd output cuts beyond
June

By Florence Tan
SINGAPORE, May 29 (Reuters) - Oil prices edged lower on
Friday after U.S. inventory data showed lacklustre fuel demand
in the world's largest oil consumer while worsening U.S.-China
tensions weighed on global financial markets.
Brent crude LCOc1 slipped 36 cents, or 1%, to $34.93 a
barrel by 0106 GMT and U.S. West Texas Intermediate crude CLc1
was at $33.20 a barrel, down 51 cents, or 1.5%. Still, both
contracts are set for a fifth weekly gain, helped by production
cuts and optimism about demand recovery in other countries.
Thursday's data from the Energy Information Administration
showed that U.S. crude oil and distillate inventories rose
sharply last week. Fuel demand remained slack even as various
states lifted travel restrictions they had imposed to curb the
coronavirus pandemic, analysts said. "Memorial Day weekend did not bring U.S. motorists out in
droves like many market bulls were hoping," RBC Capital Markets
analyst Christopher Louney said in a note.
Looking ahead, traders will be focusing on the outcome of
talks on output cuts between members of OPEC+, the Organization
of the Petroleum Exporting Countries (OPEC) and allies including
Russia, in the second week of June.
Saudi Arabia and some OPEC members are considering extending
record production cuts of 9.7 million barrels per day beyond
June, but have yet to win support from Russia.

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