Oil costs dropped. After economic data from China sparked new worries about a potential global recession that could affect energy demand, the price of a barrel dropped below $95 a barrel.
The price of Brent crude futures decreased by 90 cents, or 1%, to $94.20 a barrel. WTI crude futures decreased by 81 cents or 0.9% to $88.60 a barrel. Over the previous session, the price of oil futures decreased by nearly 3%.
After China’s poor economic data, prices dropped. Data revealed an unexpected slowdown in the economy in July, with manufacturing and retail activity being constrained by Beijing’s zero-COVID policy and a real estate crisis. The country’s central bank lowered lending rates to boost demand.
China’s fuel product exports will rebound in August to near the highest for the year so far after Beijing issued more quotas in June and July, although broader curbs are set to cap shipments at seven-year lows for 2022, analysts and traders said.
After Beijing issued additional quotas in June and July, China’s exports of fuel products will increase in August to almost the highest level of the year so far, analysts and traders predicted. However, broader limitations are expected to cap shipments at seven-year lows for 2022.
On the other hand, the price of crude oil dropped on Wednesday after data revealed an unexpected increase in US stocks, underscoring concerns about demand. American Petroleum Institute figures show that in the week that concluded on August 5, US crude stocks increased by around 2.2 million barrels.
A larger than anticipated 2.156 million barrel increase in US crude oil supplies, a somewhat smaller-than-expected fall in gasoline stocks, and an unexpected increase in distillate stocks were all mentioned in the API weekly report, which is generally unfavorable. If today’s EIA report is consistent with the API report, US crude stocks may rise, raising the possibility of a price correction.