Although trading volumes were low due to a holiday in the United States, the oil prices fell this Monday due to doubts about the Chinese economy, which outweighed OPEC+ production cuts and the seventh consecutive decline in the number of oil and gas rigs operating in the United States. Rising Iranian oil exports also weighed on prices.
the brentwhich is listed in London, it fell 48 cents (-0.6%) to US$76.13 a barrelMeanwhile he West Texas Intermediatein the United States (WTI), it lost 61 cents, or 0.9%, to settle at $71.17.
Both contracts closed last week with gains of over 2% in a context in which several big banks have cut their forecasts for the growth of China’s Gross Domestic Product in 2023, after May data released last week showed the post-crisis recovery of the world’s second-largest economy faltering.
The Chinese economy, a concern
Expected China to cut interest rates benchmarks on Tuesday, following a similar reduction in medium-term lending last week, to underpin a shaky economic recovery. The Asian giant is expected to cut its benchmark lending rates on Tuesday, after a similar cut in medium-term lending last week to shore up a shaky economic recovery.
The oil market is watching for more signs of whether the global economy will recover, said Jorge Leon, a senior vice president at Rystad Energy. “Much will depend on China’s economic performance in the second half of this year and the effectiveness of the country’s recently announced stimulus measures, and the ability of the United States and Europe to avoid an economic slowdown amid rising interest rates,” Leon wrote in a research note.
However the performance of Chinese refineries increased in May to its second-highest total on record, helping boost gains last week, and US energy companies reduced the number of oil and natural gas rigs in operation for the seventh straight week for the first time since July 2020.
The dynamics of oil in Iran
On the other hand, Iran’s oil exports and production hit record levels in 2023, despite US sanctions, adding to global supply when other producers limit pumping.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
