Oil steadies as investors digest China gloom, eye US crude supplies

oil-steadies-as-investors-digest-china-gloom,-eye-us-crude-supplies
Oil steadies as investors digest China gloom, eye US crude supplies

Oil prices remained relatively stable on Tuesday as investors considered the potential impact of tightening U.S. crude supplies in contrast to weaker-than-expected Chinese economic growth. Brent crude held steady at $78.49 a barrel, while U.S. West Texas Intermediate crude saw a slight increase to $74.16 a barrel. Both benchmarks had experienced a decline of over 1.5% on Monday due to lackluster Chinese data and the partial restart of certain Libyan oilfields.

Market participants were eagerly awaiting industry data that would be released later in the day, which was expected to reveal a decrease in U.S. crude oil stockpiles and product inventories from the previous week. The sluggish GDP data from China, released on Monday, had a cautious effect on prices, with concerns about the pace of its demand recovery. Jun Rong Yeap, a market strategist at IG in Singapore, noted that China’s GDP had grown by 6.3% year-on-year in the second quarter, falling short of analyst forecasts of 7.3% and indicating a loss of momentum in its post-pandemic recovery.

In addition to the Chinese data, the Energy Information Administration reported on Monday that U.S. shale oil production was expected to experience its first monthly decline since December 2022. However, the resumption of output at two of the three Libyan fields that were previously closed was anticipated to boost global supplies. The closure of these fields had been due to a protest against the abduction of a former finance minister.

Looking ahead, PVM analyst John Evans commented on the typical pattern of OPEC releasing positive statements at the beginning of the month, followed by a more pragmatic approach as economic data is assessed. He noted that this often leads to a deflation in mood as the month progresses.

In conclusion, oil prices remained steady as investors weighed the impact of U.S. crude supplies and weaker Chinese economic growth. The market awaited industry data on U.S. crude oil stockpiles, while the resumption of output in Libyan fields was expected to boost global supplies. The cautious sentiment was reflected in the deflation of mood as economic data is evaluated throughout the month.

About News Team

Hi, I'm Alex Perez, an experienced writer with a focus on lifestyle and culture news. From food and fashion to travel and entertainment, I love exploring the latest trends and sharing my insights with readers. I also have a strong interest in world news and business, and enjoy covering breaking stories and events.

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