Oil prices dipped slightly on Monday on concerns that a U.S.-China trade dispute will erode global economic growth, although looming U.S. sanctions against Iran’s oil sector kept crude from falling further, traders said.
International Brent crude oil futures were at $75.75 per barrel at 0122 GMT, down 7 cents from their last close.
U.S. West Texas Intermediate (WTI) crude futures were down 9 cents at $68.63 a barrel.
“Falling U.S. rig counts and last week’s decline in U.S. inventories are supporting oil prices amid a protracted U.S.-China trade war that could dampen global growth and weigh on oil demand,” said Stephen Innes, Head of Trading for Asia/Pacific at futures brokerage OANDA in Singapore.
U.S. energy companies cut nine oil drilling rigs last week, dropping to 860, the biggest reduction since May 2016, energy services firm Baker Hughes said on Friday.
“Despite growing concerns about potential oversupply, the markets will continue to get a fillip from U.S. sanctions against Iran,” Innes added.
Washington will target Iran’s oil exports with sanctions from November.
OPEC-member Iran has exported around 2.5 million barrels per day (bpd) of crude oil so far this year. Most analysts expect this figure to fall by at least 1 million bpd once sanctions kick in.