Oil prices decline due to weak demand in China and truce talks in the Middle East
25 July 2024 12:22
On Thursday, 25 July 2024, oil prices continued to decline. The main factors behind this decline were concerns about weak demand in China, the world’s largest oil importer, and expectations of a possible truce in the Middle East, reports "Komersant Ukrainian" reports with reference to Reuters.
Futures for Brent crude for September delivery fell 0.7% to $81.12 per barrel, while US WTI fell 0.8% to $76.98 per barrel.
Despite positive data on the decline in US oil inventories, which supported prices on the previous day, investors remain concerned about the situation in China. This year, China’s oil imports and refining have declined compared to 2023 due to weak demand for fuel amid slowing economic growth.
Additional pressure on prices comes from expectations of progress in ceasefire talks between Israel and Hamas. Efforts to reach a truce agreement in the Gaza Strip have gained momentum over the past month.
Analysts also note that the fall in US stock markets has reduced traders’ appetite for risk. In addition, uncertainty about future interest rate cuts in the US is also affecting the oil market.
Experts warn that if the truce talks in the Middle East continue to progress, US stocks continue to fall, and China’s economy remains sluggish, oil prices could return to early June levels.
Meanwhile, Hungary and Slovakia are threatening legal action over the suspension of Russian oil transit.
