Crude oil futures saw a downward shift on Monday, driven by investor concerns over waning oil demand in the world’s two largest economies, China and the United States.
West Texas Intermediate (WTI) crude futures witnessed a decrease of 88 cents, equivalent to a 1.06% decline, reaching $81.94 per barrel. Similarly, Brent crude futures experienced a drop of 90 cents, or 1.04%, to settle at $85.34 per barrel.
According to John Kilduff, an analyst at Again Capital, investors opted to capitalize on profits following six consecutive weeks of WTI oil price gains. This decision came amid the impending end of the US summer season in early September, coupled with apprehensions surrounding the deceleration of oil demand in China.
Compounding the market dynamics, the strength of the dollar exerted an additional pressure on crude oil contracts, which are priced in dollars. As the dollar index rallied, these contracts became costlier and less appealing to investors holding currencies other than the dollar. Federal Reserve Governor Michelle Bowman’s remarks on the necessity of continued interest rate hikes to steer inflation towards the Fed’s 2% target added to the market sentiment.
The spotlight remains on China’s economic data this week, with investors keen to gauge the stance of the Chinese government regarding potential supplementary stimulus measures. Today, on August 8, the Chinese authorities are set to unveil July’s import, export, and trade balance figures. Subsequently, on August 9, the Chinese market anticipates the release of the Consumer Price Index (CPI) and the Producer Price Index (PPI) for the same month.
Simultaneously, market participants await the unveiling of the US Consumer Price Index (CPI) on August 10, Thursday, seeking indications about the trajectory of the Federal Reserve (Fed). As the interplay of various factors shapes the oil market landscape, astute investors continue to monitor these signals for insights into the future course of oil prices and market trends.
The Spot Market is Open
Tuesday, August 8, 2023
| Energy Updated at | USD Price | Change | %Change |
| Crude Oil 11.00 | 82.06 | +0.12 | +0.15% |