Oil prices dipped on Monday as concerns about China’s faltering economic recovery and a stronger dollar took the momentum out of seven weeks of gains on tight supply.
Brent crude futures were down 63 cents at $86.18 a barrel by 1555 GMT, while US West Texas Intermediate crude lost 59 cents to $82.60 a barrel.
Market participants are torn, weighing a tight supply-demand balance against signs of weakening demand from China, said Phil Flynn, analyst at Price Futures Group.
“Part of it seems to be the Monday morning blahs. I think we still have to face a market that’s very tight,” Flynn said.
Vandana Hari, founder of oil market analysis provider Vanda Insights, said a correction may be on the cards for crude markets.
“Crude has been in overbought territory for some time now, defying expectations of a correction,” Hari said. She added that the focus had been on US economic optimism, to the exclusion of economic headwinds in the euro zone and China.
