By Aaron Sheldrick

TOKYO, Reuters – Tuesday’s oil prices dropped. Brent fell for the second consecutive day after data from China showed slowing economic growth. In September, U.S. production declined. This raises new concerns over demand in light of the patchy recovery following coronavirus.

After falling 0.6% Monday, the barrel was $0.5 less at $83.90 per barrel on 0132 GMT. It fell 43 cents or 0.5% to $83.90 per barrel. The contract remains up almost 7% for this month.

U.S. oil prices fell by 33 cents (or 0.4%) to $82.11/barrel after rising 0.2% during the previous session. This month, it has risen nearly 10%.

The United States saw its factory output drop the most in 7 months. This was due to a shortage of semiconductors worldwide, which slowed automobile production. It is further proof that economic growth can be hampered by supply limitations.

China is the second largest economy in the world. However, China’s bottlenecks contributed to the decline of the growth rate. The country was hit by energy shortages, coronavirus outbreaks, and other problems.

China’s daily processing rates fell to their lowest level in May, last month.

Analysts say that oil, gas, and coal prices will remain higher despite the fact that temperatures fall in winter.

Citi Research commodities analysts noted that “a cold winter can send energy prices even higher,” after they upgraded their Brent oil price forecast from $74 to $85 a barrel.

AccuWeather.com predicts that China will experience colder temperatures, and the mercury could drop to freezing in northern areas.

U.S. crude oil production is increasing, helping to maintain a price ceiling. An official report states that the U.S. will see an increase in production from the biggest shale formation next month.