Oil dips as China worries counter supply cuts
An oil pump jack pumps oil in a field, July 21, 2014. Pump jacks are used to pump crude oil out of the ground after an oil well has been drilled. PHOTO: REUTERS/FILE
Oil prices dipped on Monday as concerns about China’s faltering economic recovery and a stronger dollar took the momentum out of seven weeks of gains on tight supply.
Brent crude futures were down 63 cents at $86.18 a barrel by 1555 GMT, while US West Texas Intermediate crude lost 59 cents to $82.60 a barrel.
Market participants are torn, weighing a tight supply-demand balance against signs of weakening demand from China, said Phil Flynn, analyst at Price Futures Group.
“Part of it seems to be the Monday morning blahs. I think we still have to face a market that’s very tight,” Flynn said.
Vandana Hari, founder of oil market analysis provider Vanda Insights, said a correction may be on the cards for crude markets.
“Crude has been in overbought territory for some time now, defying expectations of a correction,” Hari said. She added that the focus had been on US economic optimism, to the exclusion of economic headwinds in the euro zone and China.
Published in The Express Tribune, August 15th, 2023.
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