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Oil extended losses at the start of the week as traders weighed concerns about Chinese demand and the prospect for more Iranian supply.

West Texas Intermediate fell toward US$91 a barrel after closing 2,4 percent lower on Friday.

China’s central bank unexpectedly cut its key interest rates as it boosts support for an economy hit by virus lockdowns and property woes.

European Union proposals to revive a nuclear agreement are acceptable if Tehran can be reassured on various issues including sanctions, Iran’s state-run IRNA said.

Crude has ticked lower over the past couple of months on concerns about an economic slowdown, shedding all the gains put on following Russia’s military action in Ukraine.

Money managers have cut their bullish bets on WTI to the lowest in over two years, according to the Commodity Futures Trading Commission.

“Renewed Covid-19 lockdowns in China are weighing on demand on top of recessionary worries, while supply concerns have melted away,” said Vandana Hari, founder of Singapore-based Vanda Insights.

The prospect of Iranian supply returning adds to the bearish sentiment, she added.

China’s economic recovery unexpectedly weakened in July as fresh Covid-19 outbreaks impacted consumer and business spending. — Bloomberg.