Oil prices hold near near three-month lows

Oil prices held near their lowest levels in nearly three months amid ongoing concerns about the outlook for demand in regions such as the United States. WTI crude oil rose slightly above $67 a barrel after falling about 8% in the previous three trading sessions. A slowing U.S. economy and a resilient Russian export added to downward pressure on oil prices, offsetting Saudi Arabia’s recent decision to cut output by 1 million bpd. Goldman Sachs cut its oil price forecast for the third time in six months, saying it expects higher supply and lower demand. Short-dated contract spreads also showed weakness. Brent’s spot spread (the difference between the front-month contract and the next-month contract) was at one point close to parity, a sign of ample supply. Still, there were signs of new physical demand, with U.S. sour crude hitting its highest level in a year after the U.S. pledged to replenish its Strategic Petroleum Reserve. In addition, slowing U.S. inflation will support the Federal Reserve’s pause in raising interest rates this week, which could boost energy demand.