Oil slips as US-China friction

Oil slips as US-China friction

Oil prices edged lower on Monday as rising coronavirus cases and tensions between the United States and China pushed investors toward safe-haven assets.

Brent crude dipped 8 cents, or 0.2%, to $43.26 a barrel by 04:03 GMT, while U.S. West Texas Intermediate (WTI) crude dropped to $41.22 a barrel, down 7 cents, or 0.2%.

The fall in oil mirrored moves in broader financial markets in Asia amid concerns about escalating tensions between the world's two biggest economies following the closures of consulates in Houston and Chengdu. Global coronavirus cases, meanwhile, exceeded 16 million.

Still, Brent is on track for a fourth straight monthly gain in July and WTI is set to rise for a third month as unprecedented supply cuts from the Organization of the Petroleum Countries and its allies including Russia propped up prices. Output has also fallen in the United States.

The rebound in oil prices from lows hit earlier this year has also encouraged the world's top producers to increase output and exports again, Reuters  reported.

The U.S. oil rig count rose last week for the first week since March after producers added one rig, Baker Hughes data showed, a sign that U.S. oil production decline may have bottomed out.

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