Oil prices retreated slightly after losing nearly 5% on Tuesday, as a possible easing of political unrest in Libya shifted focus back to concerns about global demand and OPEC+'s plan to boost output from October.
Brent crude was trading near $74 a barrel, while West Texas Intermediate was on the cusp of falling below $70 for the first time since early January. Libya’s central bank governor said a deal appeared imminent to resolve a dispute between rival governments in the conflict-torn North African nation, which could spur a resumption of oil production.
There had been some speculation that the unrest in Libya could give OPEC+ room to bring back more barrels as planned, but the decision is likely to make it harder for the alliance to boost output without hurting prices. The alliance has previously said it could pause or reverse increases if necessary.
Oil has now erased all of this year’s gains on concerns about the economic outlook in China, the world’s largest importer of crude, and ample supplies from outside the Organization of the Petroleum Exporting Countries. Automated trading may have accounted for some of yesterday’s losses, with algorithms increasingly following the downward trend.
