Oil falls as demand concerns persist

Oil prices fell for a fourth day as concerns about the U.S. economy and China’s slower-than-expected recovery weighed on the outlook. U.S. crude fell below $70 a barrel after capping a fourth weekly loss since September. Treasury Secretary Janet Yellen warned the department could run out of money on June 1, while talks continue to avert a U.S. default on the debt ceiling. Oil is down 13% for the year as fears of a possible U.S. recession outweigh supply cuts pledged by OPEC+. Physical demand for barrels also appears weak, while refinery margins, the profits refiners make from turning crude into petroleum products such as diesel and gasoline, remain tight. Hedge funds and money managers amassed the largest short position in global benchmark Brent since July 2021, even as speculators were less bearish on U.S. crude. Investors will be watching key economic data from China this week and the International Energy Agency’s monthly report due on Tuesday for clues about the pace of the country’s recovery. “Oil market sentiment remains negative due to the uncertain demand outlook and concerns over the U.S. debt ceiling. The market will likely be looking for possible demand revisions in the IEA’s monthly market report,” said Warren Patterson, head of commodity strategy at ING Groep NV.