WASHINGTON (dpa-AFX) - Oil prices fell sharply and hit a nine-month low on Tuesday, as weak economic data from China raised concerns about the outlook for oil demand. Prospects of more oil supply from OPEC and allied countries, collectively known as OPEC+ also weighed on oil prices.
Also, the end of the summer driving season in the U.S. added to concerns about oil demand. All these concerns offset supply disruptions from Libya following political unrest.
West Texas Intermediate Crude oil futures for October ended down by $3.21 or about 4.4% at $70.34 a barrel.
Brent crude futures were down $3.83 or 4.93% at $73.69 a barrel a little while ago.
Recent data raised concerns that China's economic growth is unlikely to bounce back this year, with key gauges of domestic factory demand dropping more than expected in August.
Meanwhile, OPEC signaled that it will follow through with earlier signals of higher OPEC+ output in the fourth quarter, making up for lower production in Libya.
According to reports, Libya's state National Oil Corporation has declared a state of force majeure at its El-Feel crude oil field from September 2. Operated by Mellitah Oil and Gas, this field has a capacity of 70,000 barrels a day.
The politically forced oil field closure by the eastern based Hafter regime comes as a result of the Central Bank of Libya crisis.
A Reuters report said the UN Support Mission in Libya held talks on Monday to resolve the dispute over control of the central bank.
This dispute triggered a blockade of crude oil production, following which Libya's oil production dropped to below half of its usual level.
Elsewhere, two crude oil tankers, the Saudi-flagged Amjad and Panama-flagged Blue Lagoon I, were attacked in the Red Sea on Monday by Yemen's Iran-backed Houthi rebels in a significant escalation of tensions.
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