• Oil prices drop on higher OPEC and U.S. supply
  • Trade tensions keep weighing on Asian shares
  • Middle East stocks end lower on trade concerns
  • The dollar adds gains, gold prices retreat on a stronger dollar

Oil prices

Oil prices retreated early on Monday as the Organization of the Petroleum Exporting Countries’ (OPEC) output rose by 220,000 barrels per day (bpd) between July and August, to a 2018-high of 32.79 million bpd, according to a Reuters survey.

OPEC’s output was boosted by a recovery in Libyan production and as Iraq’s southern exports hit a record high.

Increasing supply from the United States also weighed on prices, as U.S. drillers added oil rigs for the first time in three weeks, energy services firm Baker Hughes reported on Friday, increasing the rig count by 2 units to 862.

Despite the price dip, Stephen Innes, head of trading for Asia-Pacific at futures brokerage OANDA told Reuters that Brent was “supported by the notion that U.S. sanctions on Iranian crude oil exports will eventually lead to constricted markets”, which he said would likely push up prices.

“Iranian production is already showing signs of decline, falling by 150,000 barrels per day (bpd) last month ... (as) importers of Iranian barrels will already be moving away from taking shipments,” Edward Bell, commodity analyst at Emirates NBD bank in Dubai, told Reuters.

Global markets

Asian shares dropped on Monday as trade tensions between the U.S. and China weighed on investor sentiment.

U.S. President Donald Trump said that he is ready to implement the new tariffs on Chinese products as soon as a public comment period on the plan ends on Thursday.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.2 percent while Japan's Nikkei fell 0.4 percent.

Wall Street will be closed on Monday due to a holiday.

On Friday on Wall Street, the Dow Jones Industrial Average fell 22.1 points, or 0.09 percent, to 25,964.82, the S&P 500 gained 0.39 points, or 0.01 percent, to 2,901.52 and the Nasdaq Composite added 21.17 points, or 0.26 percent, to 8,109.54.

“It looks almost certain that Trump will impose 25 percent tariffs on $200 billion worth of imports from China,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities, told Reuters.

Middle East markets

Most stock markets in the Middle East retreated on Sunday as trade worries between the U.S. and China kept investors on edge.

Saudi Arabia’s stock market dropped 0.4 percent. Saudi Basic Industries dropped 1 percent and Saudi British Bank retreated 2.3 percent.

Dubai’s index ended mainly flat with Emaar Properties adding 2 percent.

Neighbouring Abu Dhabi’s index dropped 0.9 percent as First Abu Dhabi bank retreated 1.5 percent and Etisalat retreated 1 percent.

Qatar’s index dropped 0.2 percent with Qatar National Bank slipping 0.3 percent and Qatar Islamic Bank retreating 0.7 percent.

Egypt’s index fell 1 percent, dragged down by a 13.5 percent drop in the shares of Global Telecom, after the company said minority shareholders may not approve an offer from shareholder VEON to acquire its assets in Pakistan and Bangladesh.

Kuwait’s index added 0.2 percent, Bahrain’s index dropped 0.1 percent while Oman’s index rose 0.4 percent.

Currencies

The dollar index against a basket of six currencies edged higher to 95.182 as of 0100 GMT on Monday.

The euro was down about 0.1 percent at $1.1595, extending its slide of the past two sessions.

The yen advanced about 0.1 percent to 111.02 yen against the dollar.

Precious metals

Gold prices retreated on Monday on a stronger dollar.

Spot gold was down 0.3 percent at $1,196.93 an ounce at 0054 GMT.

U.S. gold futures were down 0.4 percent at $1,202.50 an ounce.


 

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(Writing by Gerard Aoun; Editing by Mily Chakrabarty)

(gerard.aoun@thomsonreuters.com)

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