Investing.com – Oil prices slipped on Friday as concerns about a China-U.S. trade war and the return of Libyan oil to the market continued to be cited as catalysts for the selling.
The Libya's National Oil Corp announced on Wednesday that four export terminals were being reopened and allowed the return of as much as 850,000 barrels per day of oil into the markets, ending a standoff that had shut down most of Libya's oil output.
Crude Oil WTI Futures for August delivery were trading at $70.32 a barrel at 12:40AM ET (04:40 GMT), down 0.1%. Brent Oil Futures for September delivery, traded in London, were also down 0.2% at $74.28 per barrel.
The International Energy Agency, however, raised expectations for a global shortage in crude supplies as the energy watchdog warned of a potential capacity crunch amid a rise in output from Middle East Gulf countries and Russia, helping oil prices to recoup some losses.
"Rising production from Middle East Gulf countries and Russia, welcome though it is, comes at the expense of the world's spare capacity cushion, which might be stretched to the limit," the Paris-based agency said in its monthly report.
Saudi Arabia increased production by 430,000 barrels a day in June, the IEA said. That, however, was offset somewhat by falling Iranian exports, as European traders trimmed their imports ahead of U.S. sanctions on Tehran, which come into effect in November.
"In June, Iran's crude exports fell back by about 230,000 barrels a day, albeit from a relatively high level in May, as European purchases dropped by nearly 50%," the agency said.
Trade dispute China and the U.S. also remained in focus. Treasury Secretary Steven Mnuchin said on Thursday that he and the administration are “available” for discussion, but China must first agree to deeper economic reforms.
“To the extent that China wants to make structural changes, I and the administration are available,” Mnuchin said on Thursday. “We are not advocating tariffs. We are advocating fair trade.”
China’s Vice Minister of Commerce Wang Shouwen also said on Thursday that “when we have a trade problem, we should talk about it.”