Oil falls on weak China data, stronger U.S. dollar

31 May Oil falls on weak China data, stronger U.S. dollar

Oil prices fell on Wednesday on a stronger U.S. dollar and as weak data from top oil importer China raised demand fears.

Brent crude futures for August delivery were down $1.29, or 1.75%, to $72.42 a barrel at 1013 GMT. U.S. West Texas Intermediate crude (WTI) fell $1.28, or 1.84%, to $68.18.

Both benchmarks fell by more than 4% on Tuesday.

Brent’s July contract , which expires on Wednesday, and the U.S. benchmark were on track for monthly declines of more than 9% and 11%, respectively.

China’s manufacturing activity contracted faster than expected in May on weakening demand, with the official manufacturing purchasing managers’ index (PMI) down to 48.8 from 49.2 in April. The outcome lagged a forecast of 49.4.

Further pressure came as the U.S. dollar rose to its highest in over two months, making commodities more expensive for buyers holding other currencies and weighing on oil demand.

Market players are preparing for the upcoming June 4 meeting of OPEC+

Mixed signals by major OPEC+ producers on whether or not the group will decide to further cut oil production have sparked recent volatility in oil prices.