Oil prices hold near 2-week low on gloomy demand outlook

Oil prices were little changed, trading near their lowest in two weeks on Wednesday, a day after OPEC downgraded its forecast for global oil demand growth in 2024 and 2025 and amid demand concerns in China, reports Reuters.

Brent futures were up 15 cents, or 0.21 per cent, to $72.04 a barrel at 1249 GMT, while US West Texas Intermediate (WTI) crude futures were up 18 cents, or 0.26 per cent, at $68.30.

Falling demand projections and weakness in major consumer China continued to weigh on market sentiment and crude prices.

Oil prices have lately dropped sharply due to a stronger dollar following Donald Trump's victory in the US presidential election, weak Chinese stimulus efforts, and OPEC cutting its demand forecasts, said Charalampos Pissouros, senior analyst at XM.

"All these developments keep the risks surrounding oil prices tilted to the downside, suggesting that WTI crude oil may soon visit its September lows of around $65.70," said Pissouros.

OPEC on Tuesday lowered its global oil demand growth forecast for this year and next, citing weakness in China, India, and other regions. This marked the producer group's fourth straight downward revision for 2024.

Oil prices settled up 0.1 per cent on Tuesday following the news, after a 5 per cent drop in the previous two sessions.

The International Energy Agency, which has a far lower forecast, is set to publish its updated estimate on Thursday.

On the supply side, markets could still face disruption from Iran or further conflict between Iran and Israel, according to Barclays.

Trump's expected pick for secretary of state, U.S. Senator Marco Rubio, is known for his hardline stance on Iran, China and Cuba.

Rubio's appointment could be bullish for prices, as his hawkish view on Iran could see sanctions enforced, potentially removing 1.3 million barrels per day from global supply, said Panmure Liberum analyst Ashley Kelty.

Iran's oil minister said the country had made plans to sustain its oil production and exports, and was ready for possible oil restrictions from the U.S, according to the ministry's news website Shana.