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Crude Oil News Today: Steady Despite Mixed Chinese Data

Chinese Economic Data Impact

Monday’s economic reports from China painted a mixed picture. Retail sales exceeded forecasts due to a holiday boost, but other key metrics, including industrial output and fixed-asset investment, indicated slower growth. Additionally, oil refining activity in China fell to its lowest rate this year due to maintenance shutdowns, raising concerns about the country’s overall demand for crude.

Market Performance

Global benchmark Brent crude futures were slightly up . West Texas Intermediate (WTI) crude futures edged higher. This performance comes after both benchmarks posted their first weekly gains in a month, driven by expectations of a significant drop in oil inventories with the onset of the summer driving season.

Influence of OPEC and IEA Reports

Last week, reports from OPEC and the International Energy Agency (IEA) provided some optimism, despite differing views on the strength of oil demand growth for the remainder of the year. OPEC’s forecast for robust demand in 2024 has faced skepticism due to its vested interests, while the IEA’s more conservative outlook suggests a need for strong economic recovery in China to sustain demand growth.

U.S. Consumer Sentiment and Geopolitical Concerns

The recent drop in U.S. consumer sentiment to a seven-month low in June has also added a bearish sentiment to the market, raising doubts about the resilience of American consumer spending amid rising interest rates and cost-of-living pressures. Additionally, geopolitical tensions remain a concern, with potential for escalation in the Middle East following increased cross-border fire between Israel and Lebanon’s Hezbollah.

Market Forecast

Given the current balance of positive and negative influences, the short-term outlook for oil prices remains cautiously bullish. The anticipated increase in demand from the summer driving season and potential inventory drawdowns support a positive trend. However, continued weak economic performance in China and global geopolitical risks could limit significant price advances. Traders should monitor Chinese economic data closely, as any signs of stronger recovery could provide further support for oil prices.

Technical Analysis

Read More: Crude Oil News Today: Steady Despite Mixed Chinese Data

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