Crude oil futures closed in negative territory on Monday, September 11, as worries about China’s economic prospects, the world’s largest oil importer, weighed on the market. Concurrently, investors remained vigilant about reports on US crude oil inventories and a forthcoming assessment of oil demand and supply trends later this week.
West Texas Intermediate (WTI) crude futures slipped by 22 cents, equivalent to 0.3%, concluding at $87.29 per barrel. Meanwhile, Brent crude futures experienced a minor dip of 1 cent, closing at $90.64 per barrel.
At the onset of the trading session, WTI crude oil futures reached $88.15, marking their highest level since November 2022. This uptick was driven by investor reactions to global oil supply constraints. Saudi Arabia’s announcement of an extension to voluntary oil production cuts of 1 million barrels per day until year-end, coupled with Russia’s decision to prolong the reduction in oil exports to 300,000 barrels per day until year-end, added to the bullish sentiment.
The market also received initial support from reports that Libya had closed four oil export ports since Saturday, September 9, due to adverse weather conditions, including strong wind gusts and heavy flooding in the eastern region.
However, oil prices retreated subsequently due to concerns over the slowdown in the Chinese economy, which could potentially curtail oil demand.
Naeem Aslam, an analyst at Zaye Capital Markets, emphasized the importance of forthcoming US inflation data this week, which will provide insights into the interest rate trajectory of the US Federal Reserve (Fed). Anticipated to have wide-ranging impacts on various markets, including foreign exchange, equities, and commodities, including oil, these inflation figures are closely monitored.
The United States is slated to release the Consumer Price Index (CPI) for August on Wednesday, followed by the Producer Price Index (PPI) for August on Thursday. These releases will precede the Fed’s monetary policy meeting scheduled for September 19-20.
In the days ahead, investors will also keep an eye on the US Energy Information Administration’s (EIA) report on crude oil stocks, alongside reports from the International Energy Agency (IEA) and the Organization of the Petroleum Exporting Countries (OPEC) detailing oil supply and demand trends, adding further layers of complexity to the evolving oil market dynamics.
The Spot Market is Open
Tuesday, September 12, 2023
| Energy Updated at | USD Price | Change | %Change |
| Crude Oil 13.40 | 87.63 | +0.34 | +0.39% |