Oil prices fall on fears of “demand destruction” and weak Chinese exports
Oil prices fell nearly 3% on Tuesday following China’s exports It decreased for the sixth month in a rowWhich highlights the slowdown in global demand.
October exports to the world’s largest oil consumer fell 6.4% year-on-year, while imports rose 3%.
Daily price movements more than 2% Either trend has become a common occurrence since Hamas’ surprise attack on Israel last month, keeping oil futures volatile but on a downward trend over the past two weeks.
“The market remains more focused on demand destruction than escalating war tensions,” wrote Dennis Kessler, senior vice president of trading at BOK Financial.
Moscow and Saudi Arabia recently reimposed their voluntary unilateral restrictions, which will continue until September It has fueled supply pressure Although Bloomberg data shows that exports coming from Russia as well At the highest level in four months.
“While Saudi and Russian supply cuts are now set to end at the end of the year, there may be some cheating observed,” Kessler said, noting that Russian ship traffic indicates higher crude export levels than what the Russian oil minister stated.
OPEC+, a group of major oil exporting countries, is scheduled to hold its next meeting later this month. Saudi Arabia and Russia could decide to extend their unilateral restrictions into next year. These cuts come in addition to cuts from the rest of the oil cartel, which continue until 2024.
On Tuesday, the US dollar index rose (DX-Y) rose, which also put pressure on crude oil prices. Oil is denominated in dollars.
Ince Ferry is Yahoo Finance’s chief business correspondent. Follow her on Twitter at @ines_ferre.