Pessimism about the market's trajectory combined with violence in Nigeria, an OPEC member, sent crude oil prices lower in early Monday trading.
A research note from Morgan Stanley finds that, in general, crude oil supplies are building as U.S. shale producers become more resilient during an era of lower oil prices and as Canadian disruptions from May wildfires in Alberta start to fade. Downside risks remain, meanwhile, to global economic growth because of the uncertainty in the European economy following the British vote to leave the European Union.
For the second half of the year, Morgan Stanley said it was expecting negative pressures to build, "hence our bearish oil bias."
The price of oil lost further ground, continuing a downward trend prompted Friday by data from Baker Hughes showing an increase in exploration and production activity in the United States. The price for Brent crude oil was down 1.5 percent to start trading in New York at $45.00 per barrel. West Texas Intermediate, the U.S. benchmark price, lost 1.6 percent to open at $43.48 per barrel.
North American trends in supply countered lingering declines in the Middle East and North Africa, where Libya and Nigeria continue to underperform. In its first such claim in nearly three weeks, the Niger Delta Avengers, a militant group fighting what it sees as economic injustice, said it blew up a pipeline operated by the state-run National Petroleum Corp.
On the economic front, Christine Lagarde, the managing director of the International Monetary Fund, told ministers gathered in China for a meeting of the Group of 20 economic powers that market volatility and uncertainty in the wake of the British referendum to leave the EU put a damper on mid-term growth.
"Lackluster growth of the post-crisis era continues, with weak demand in advanced economies and difficult transitions to a self-sustained growth model in many emerging markets," she said in her prepared remarks. "As a result, global growth has been revised downward slightly for both 2016 and 2017."
