Saudi ice cream maker FADECO’s profits wiped out despite rising revenue

HOUSTON: Oil prices fell more than $7 a barrel on Tuesday, the biggest drop in about a month, on fears that an inflation-induced weakening in global economies could slow fuel demand and unrest in Iraq have failed to shake the country’s OPEC crude exports.

Brent crude futures for October settlement fell $7.12, or 6.8%, to $97.97 a barrel as of 12:20 p.m. EDT (1620 GMT) after hitting a low sessional price of $97.91 a barrel.

The October contract expires on Wednesday and the more active November contract was at $97.10, down 5.7%.

U.S. West Texas Intermediate crude fell $6.10, or 6.3%, to $90.93.

Inflation is near double-digit territory in many of the world’s largest economies. This could prompt central banks in the United States and Europe to resort to more aggressive interest rate hikes, which could slow economic growth and weigh on fuel demand.

Prices fell after comments from Iraqi state-owned distributor SOMO that the country’s oil exports are unaffected by the unrest, UBS analyst Giovanni Staunovo said.

Baghdad’s worst fighting in years between different political groups continued for a second day.

Still, SOMO said it could redirect more oil to Europe if needed.

Prices felt more pressure as Russia’s fastest-growing oil producer Gazprom Neft said it planned to double oil production from its Zhagrin field in Western Siberia to more than 110,000 barrels a year. day.

Investors will attend the meeting of the Organization of the Petroleum Exporting Countries and its allies, including Russia, collectively known as OPEC+, on September 5.

Saudi Arabia last week raised the possibility of OPEC+ production cuts, which sources say could coincide with increased supplies from Iran if it strikes a nuclear deal with the West .

With most producers already operating at or above capacity and with growing signs of a slowing global economy, some reduction in supply looks increasingly likely in the coming months, said Matt Weller, head of research at FOREX.com and City Index.