International oil prices plunged more than 4%! The resurgence of demand concerns has sparked panic

International oil prices fell sharply on Monday, with the WTI front-month contract tumbling 4.
80% to $93.
89 per barrel by the close, the biggest drop in nearly three weeks, and the Brent front-month contract down 3.
79% at $100.
03 per barrel
.

Weak global manufacturing data weighed on the outlook for energy demand, and markets are closely watching the upcoming OPEC+ ministerial meeting pending a final capacity decision
.

Brian Swan, senior commodities analyst at Schneider Electric, said in a note that WTI support near previous lows around $93 a barrel "could be tested again this week, with investors reviving interest
in selling as recession fears are turning significantly bearish.
" ”

In early Asian trading, Japan's manufacturing purchasing managers' index (PMI) fell to 52.
1 in July, the lowest since
September last year.
Japan's economic recovery faces a major test
under the new round of pandemic shocks as output and new orders contracted due to pressure from soaring commodity prices and supply disruptions.
A government official also warned that output remained facing downside risks
as delays in parts supply persisted.
This is one of the reasons why the
world's major central banks are raising interest rates and the Bank of Japan is sticking to its ultra-loose policy.

Eurozone manufacturing is also struggling, with the Eurozone Markit manufacturing PMI final reading of 49.
8 in July, below the boom-bust line of 50 for the first time since June 2020
.
In addition, the data showed that the new orders index fell from 45.
2 to 42.
6, the lowest level since May 2020, indicating that there is little
chance of an improvement in the short term.

Chris Williamson, chief business economist at S&P Global, said: "Eurozone manufacturing is in a growing downturn, which increases the risk of
recession in the region.
The rate of decline in new orders has reached its sharpest level since the 2012 debt crisis, and worse could be coming
.
He added: "Lower-than-expected sales, reflecting a faster decline in new orders and exports, led to the largest increase in unsold inventories of manufactured goods since survey records began
.
" ”

At the same time, the supply and demand situation has become delicate by the recovery of crude oil capacity in many places, and Libyan oil production has recovered to 1.
2 million b/d
this week from 800,000 b/d in late July, following the lifting of blockades on several oil facilities.
At the same time, there is information that the Iranian nuclear negotiations may resume
in the next few days.

As the downward pressure on the economy becomes more apparent, the OPEC+ ministerial meeting of the oil-producing countries organization on Wednesday has attracted widespread attention, and the final decision may trigger sharp fluctuations
in oil prices.
The media quoted a number of OPEC sources as saying that most respondents believe OPEC+ will remain on hold this month, while others tend to discuss
small production increases.

According to the latest reports, Saudi Arabia will push the group to increase oil production
at Wednesday's OPEC meeting.
The Saudi king made this assurance
during a face-to-face meeting with President Biden on July 16, the sources said.

Last month, US President Joe Biden visited the Middle East, hoping to persuade major oil producers, including Saudi Arabia, to increase production
significantly.
The Saudi crown prince said at the time that the country "has the capacity" to boost domestic crude capacity to 13 million barrels per day, but has no additional capacity to continue to increase
crude oil production for the time being.
Hilia Croft, an analyst at RBC Capital, said in a note: "Although Biden's visit did not receive a direct response, we believe that Saudi Arabia will continue to gradually increase production in return
.
" ”

Craig Erlam, senior market strategist at OANDA, wrote: "Since the previous production cut agreement has expired, OPEC+ has theoretically lifted all large production cuts, and now the attention will turn to how OPEC+ plans to actually meet these targets and whether further production
increases will be announced in the future.
" ”