Chinese demand concerns weigh on oil

Oil held its ground on Monday as downward pressure from concern about demand in top importer China offset support from strong demand elsewhere, OPEC+ supply restraint and geopolitical tensions in the Middle East.

The reaction of the wider markets to the attempted assassination of former US President Donald Trump was in focus. The US dollar steadied after gains earlier in the session that had weighed on oil.

Brent crude futures were up 3 cents at $85.06 a barrel by 1326 GMT. US West Texas Intermediate crude gained 7 cents to $82.28. “Chinese data including refinery runs and crude imports are not supportive,” said UBS analyst Giovanni Staunovo. “But demand growth elsewhere is still healthy.”

Crude fell last week after four weeks of gains as hopes of strong US summer demand were countered by concern over demand in China. Chinese data on Monday added to that concern. The world’s second-largest economy grew by 4.7% in the April to June quarter, official figures showed, the slowest growth since the first quarter of 2023.

On Friday separate figures showed China’s crude oil imports fell 2.3% in the first half of this year. However, the volatile situation in the Middle East continues to provide a geopolitical premium for oil, though ample spare capacity held by Saudi Arabia and other members of OPEC has limited price support, analysts say.