July 25, 2024
New Delhi, India
WTI Crude Oil Price
Oil prices eased on Thursday as concerns over weak demand in China, the world’s largest crude importer, and expectations of a nearing ceasefire deal in the Middle East overcame gains from the previous session after draws in U.S. inventories.
Market Overview:
- Brent Crude and WTI Futures: Brent crude futures for September fell by 63 cents, or 0.8%, to $81.08 a barrel by 0355 GMT. Similarly, U.S. West Texas Intermediate (WTI) crude for September slid by 63 cents, or 0.8%, to $76.96 per barrel.
- Previous Session Gains: Both benchmarks settled higher on Wednesday, snapping consecutive sessions of declines after the Energy Information Administration (EIA) reported that U.S. crude inventories fell by 3.7 million barrels last week. This compared with analysts’ expectations in a Reuters poll for a 1.6-million-barrel draw.
- Gasoline and Distillate Stocks: U.S. gasoline stocks dropped by 5.6 million barrels, against expectations for a 400,000-barrel draw. Distillate stockpiles fell by 2.8 million barrels, versus expectations for a 250,000-barrel increase, according to EIA data.
Ongoing Market Pressures:
- WTI Price Decline: The WTI price continues its losing streak as global stock markets affect risk assets. On Thursday, WTI traded around $76.70 per barrel during Asian hours, marking the sixth successive session of declines.
- China’s Growth Concerns: Sluggish economic activity in China has added downward pressure on oil prices. China’s Q2 growth was 4.7%, the weakest increase since early 2023. Concerns about the Chinese economy were intensified by an unexpected rate cut from the People’s Bank of China (PBoC) on Monday. The PBoC reduced the one-year Medium-term Lending Facility (MLF) rate from 2.50% to 2.30% on Thursday. Additionally, the Bank of China announced a 10-20 basis points cut in time deposit rates.
Geopolitical Influences:
- Middle East Ceasefire Expectations: Optimism surrounding potential ceasefire negotiations between Israel and Hamas has eased the threat of supply disruption, putting further pressure on oil prices. Israeli Prime Minister Benjamin Netanyahu has hinted at a possible ceasefire agreement, which could lead to the release of several hostages in Gaza. In a speech to the US Congress, Netanyahu outlined a vision for a “deradicalized” Gaza post-war and emphasized the potential for future partnerships between Israel and America’s Arab allies.
While the recent EIA data showing a decline in U.S. crude inventories provided some support to oil prices, the ongoing concerns about weak demand in China and expectations of a Middle East ceasefire are exerting significant downward pressure. The market will continue to watch key economic indicators and geopolitical developments closely.
At the time of writing this artilce, Wti oil price were trading at 76.92 down -0.67(-0.86%)
Disclaimer:
CurrencyVeda provides this news article for informational purposes only. We do not offer investment advice or recommendations. Before making any investment decisions, please conduct thorough research, consult with financial experts, and carefully consider your financial situation, risk tolerance, and investment goals. Investing in the stock market carries risks, and it’s essential to make informed choices based on your individual circumstances. CurrencyVeda is not liable for any actions taken based on the information provided in this article.
