U.S. crude oil sheds gains, falls more than 1% to trade below $68 per barrel as OPEC cuts forecast

U.S. crude oil futures on Tuesday fell more than 1%, shedding gains from the previous session as OPEC lowered its demand forecast for the second time in two months.

OPEC now expects demand to grow by about 2 million barrels per day in 2024, some 80,000 bpd slower than its previous forecast. The group of oil producers sees demand growth of 1.7 million bpd next year, some 40,000 bpd lower than originally anticipated.

OPEC had cut its demand outlook in August due to softening consumption in China, the world’s largest crude importer.

Here are Tuesday’s energy prices:

• West Texas Intermediate October contract: $67.88 per barrel, down 83 cents, or 1.2%. Year to date, U.S. crude oil has declined 5.3%.
• Brent November contract: $70.98 per barrel, down 86 cents, or 1.2%. Year to date, the global benchmark has pulled back 7.8%.
• RBOB Gasoline October contract: $1.91 per gallon, little changed. Year to date, gasoline has fallen 9%.
• Natural Gas October contract: $2.23 per thousand cubic feet, up 6 cents, or 2.95%. Year to date, gas has shed 11%.

Worries about softening demand in China as electric vehicle sales surge has loomed over the oil market for months now. OPEC+ is also expected to increase production in December, with Morgan Stanley and other market analysts forecasting a surplus for 2025.

Oil prices sold off last week as bearish sentiment takes hold, with U.S. crude and global benchmark Brent posting their worst weeks since October 2023.

Futures briefly recovered some lost ground on Monday as Tropical Storm Francine threatens oil and gas production as well as refining operations on the Gulf Coast.