Oil dips on demand concerns

Oil prices dropped on Tuesday, with Brent crude futures falling 32 cents to $73.59 per barrel and U.S. West Texas Intermediate crude down 44 cents to $70.27 per barrel.

The decline followed profit-taking after last week's 6% rally and disappointing Chinese economic data, which renewed concerns about demand. Despite strong industrial output, weak consumer spending in China contributed to the price drop.

Investors also adopted a cautious stance ahead of the U.S. Federal Reserve’s policy meeting, where a quarter-point interest rate cut is expected. Lower rates could boost economic growth and oil demand.

The oil market in 2025 faces potential challenges from rising supplies in non-OPEC+ countries and slowing demand, particularly in China. Additionally, new EU sanctions on Russia are unlikely to disrupt oil flows significantly.