Oil benchmarks dip

- Advertisement -

Oil retreated on Thursday from multi-month peaks hit in the previous session as higher US crude inventory and sluggish economic data from China raised concerns about global fuel demand.

Brent crude fell 9 cents, or 0.1 percent , to $87.46 a barrel, after settling at its highest since Jan. 27 in the previous session.

West Texas Intermediate crude (WTI) dropped 6 cents, or 0.1 percent , to $84.34, after settling at its highest since November 2022.

- Advertisement -

US crude inventories rose by 5.9 million barrels in the last week to 445.6 million barrels, compared with analysts’ expectations in a Reuters poll for a 0.6 million-barrel rise, US Energy Information Administration data showed on Wednesday.

US crude oil exports fell by 2.9 million barrels per day last week, the steepest fall on record, to 2.36 million barrels per day (bpd), according to the data. But the market is going to expect crude exports to go up because of the US crude futures and Brent spread, said Phil Flynn, an analyst at Price Futures Group.

Weighing on market sentiment, the consumer sector in China fell into deflation, and factory-gate prices extended declines in July, as the world’s second-largest economy struggled to revive demand.

“A 5 percent  growth forecast from China, which looked way too modest to digest at the beginning of 2023 has started to look way too optimistic as China is failing to hold economic revival post-COVID,” said Priyanka Sachdeva, senior market analyst from Phillip Nova.

The market is awaiting July’s Consumer Price Index (CPI) from the United States, due on Thursday, which will indicate the Fed’s future monetary policy. Market watchers expected the CPI to show a slight year-over-year acceleration, while on a month-to-month basis, consumer prices are seen increasing 0.2 percent , the same rate as in June.

Author

- Advertisement -

Share post: