Boats float in front of the Vopak oil storage terminal in Johor, Malaysia. Picture: REUTERS/HENNING GLOYSTEIN
Boats float in front of the Vopak oil storage terminal in Johor, Malaysia. Picture: REUTERS/HENNING GLOYSTEIN

Sydney/Singapore — Oil prices fell on Tuesday as signs of a spreading global economic slowdown stoked concerns over future fuel demand.

International Brent crude oil futures were at $62.26 a barrel at 4.10am GMT, down 48c, or 0.8%, from their previous close.

US West Texas Intermediate (WTI) crude futures were at $53.44 a barrel, down 0.7%, or 36c.

China on Monday reported its lowest economic growth figure since 1990, with GDP rising by 6.6% in 2018.

“Slowing manufacturing activity in China is likely weighing on demand,” said Singapore-based tanker brokerage Eastport on Tuesday, adding that industrial slowdowns tended to be leading indicators that only gradually fed into lower demand for shipped oil products.

In a sign of spreading economic weakness, South Korea’s export-orientated economy slowed to a six-year low growth rate of 2.7% in 2018, official data showed on Tuesday.

This followed the International Monetary Fund (IMF) on Monday trimming its 2019 global growth forecasts to 3.5%, down from 3.7% in last October’s outlook.

“After two years of solid expansion, the world economy is growing more slowly than expected and risks are rising,” IMF MD Christine Lagarde told reporters.

Despite the darkening outlook, oil prices have been getting some support from supply cuts that started in late 2018 by Opec.

“The effects of Opec-led cuts … will undoubtedly place a price floor under crude oil,” said Singapore-based brokerage Phillip Futures on Tuesday.

Reuters