A view of the main deck of Tullow Oil's newly completed Floating Production, Storage and Offloading vessel (FPSO). Britain's Tullow Oil is sending one of the world's biggest floating deep-water oil production platforms to West Africa to pump crude for at least 20 years. Picture: REUTERS
A view of the main deck of Tullow Oil's newly completed Floating Production, Storage and Offloading vessel (FPSO). Britain's Tullow Oil is sending one of the world's biggest floating deep-water oil production platforms to West Africa to pump crude for at least 20 years. Picture: REUTERS

London — Oil slipped to around $67 a barrel on Monday, weighed by concern that an economic downturn may dent fuel consumption, despite the prospect of prolonged Opec-led oil supply curbs.

Japan’s exports fell for a third month in February and US manufacturing output fell. Analysts at Bernstein Energy said on Monday that while they expect oil demand to rise by 1.3-million barrels a day in 2019, a global slowdown could limit growth to below 1-million barrels a day.

Brent crude, the global benchmark, fell 26c to $66.90 a barrel at 10.25am GMT. It reached a 2019 high of $68.14 last week. US West Texas Intermediate crude was down 37c at $58.15.

Oil edged lower after an Opec source said a panel meeting on Monday to review progress with an Opec-led supply cut deal is recommending the producers cancel a policy meeting in April, seen as a bearish outcome to the talks.

“It’s a surprise, I don’t think it was expected,” said Olivier Jakob, oil analyst at Petromatrix. “It’s quite unusual to cancel a meeting.”

Brent still has gained around a quarter since the start of the year due to supply cuts since January 1 led by the Opec and allies such as Russia, and US sanctions on Opec members Iran and Venezuela.

While Saudi Arabia has been cutting output by more than the amount it is required to, cancelling the April meeting could suggest an unwillingness by other Opec and non-Opec producers to do more to bolster prices, Jakob said.

On Sunday, Saudi Arabia signalled the producers may need to extend the supply curbs of 1.2-million barrels a day, which run until June, into the second half of 2019.

Rising oil output in the US has helped to offset the Opec-led curbs.

US crude oil production increased at the start of 2019, hitting a record 12.1-million barrels a day in February, data from the Energy Information Administration showed.

Reuters