Crude oil prices drifted lower on Monday, dragging the most active crude futures contract to its lowest close in more than a week.
Concerns about outlook for energy demand following new travel restrictions in some European countries, including Germany, Spain and Portugal, and fresh lockdown moves in Australia amid concerns over the spread of the delta variant of Covid-19 weighed on oil prices.
Traders were also a bit reluctant to create fresh long positions ahead of the upcoming meeting of the Organization of the Petroleum Exporting Countries and their allies, due this Thursday.
West Texas Intermediate Crude oil futures for August ended down by $1.14 or about 1.5% at $72.91 a barrel, the lowest close since June 18.
Analysts surveyed by Bloomberg expect OPEC+ to raise their collective output levels by another 550,000 barrels per day (bpd) in August.
Data showing a slowdown in China’s industrial profits growth raised concerns about oil demand from the world’s second largest economy.
Traders also noted the developments on the geopolitical front. The U.S. carried out airstrikes against Iran-backed militia in Iraq and Syria on Sunday, in response to drone attacks against U.S. personnel and facilities in Iraq.
The strikes targeted operational and weapons storage facilities at two locations in Syria and one location in Iraq, the Pentagon said. The Pentagon press secretary, John Kirby, described the airstrikes as “defensive”.