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CORRECTED-Oil steadies after global demand worries spark fall

Published 25/07/2019, 11:59 am
© Reuters.  CORRECTED-Oil steadies after global demand worries spark fall
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(Corrects final paragraph to drawdown, not build)

TOKYO, July 25 (Reuters) - Oil ticked higher early on Thursday after falling in the previous session as more signs of slowing global growth added to demand concerns, with Middle East tensions underpinning prices.

Brent crude LCOc1 futures were up 6 cents at $63.24 a barrel by 0053 GMT, after dropping 1% overnight, falling for the first time in four sessions.

U.S. West Texas Intermediate crude CLc1 were 12 cents, or 0.2%, higher at $55.99 a barrel, having dropped 1.6% in the previous session.

Sentiment in the oil market has darkened as investors worry that slowing global economic growth will weaken demand for oil.

A series of purchasing manager index readings in the United States and Europe were weaker than expected, confirming concerns about slower economic growth amid a trade war between the United States and China. growth concerns are driving energy prices lower as forecasts keep getting downgraded even as the U.S. will be sending a trade team to China next week," Alfonso Esparza, senior market analyst at OANDA, said in a note.

Set against those worries are ongoing tensions in the Middle East following the seizure of a British-flagged tanker in the Gulf by Iranian forces last week.

The military adviser to Iran's supreme leader was quoted on Wednesday as saying that any change in the status of the Strait of Hormuz, which Tehran says it protects, would open the door to a dangerous confrontation. about Middle East tensions are keeping oil prices supported as Iran has warned about the presence of naval ships out of the Persian Gulf," Esparza said.

Britain, meanwhile, gained initial support from France, Italy and Denmark for its plan for a European-led naval mission to ensure safe shipping in the Gulf. said on Wednesday it was holding talks with Iran, Britain and others over the seized tanker, which is Swedish owned. market shrugged off a bigger-than-forecast drawdown in U.S. crude inventories, which fell nearly 11 million barrels last week. EIA/S

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