Oil Prices Fall as China Plans 5% GDP Growth

Oil Prices Fall as China Plans 5% GDP Growth

Oil prices dipped on Tuesday following China’s 5% gross domestic product growth (GDP) target for 2024. Brent has been trading softer this morning as moderate economic growth targets from China weighed on sentiment, ING said in a note.

The country has kept GDP growth unchanged at around 5% for 2024, with the fiscal deficit target set at 3% of GDP compared to expectations of around 3.5%. Market see the plan as ambitious, raising concerns over demand outlook for 2024.

According to analyst notes, lower fiscal spending could restrict the economic stimulus measures by China even as the government aims to push the economy higher.

The market also appears to be cautious about compliance to the OPEC+ cuts for the second quarter of this year, which is essential for keeping the market in balance until demand recovers, ING added.

US gasoline cracks have been trading strong on tight supplies and improving demand. Refinery maintenance and the operational switch from winter to summer-grade gasoline have tightened US domestic supplies.

Meanwhile, a warmer-than-usual winter keeps driving activities high pushing up demand for motor fuel. Brent crude traded at $82.41 per barrel on Tuesday, representing a 0.47% decline from the closing price of $82.80 a barrel in the previous trading session.

The American benchmark West Texas Intermediate (WTI) traded at $78.25 per barrel at the same time, for a 0.62% fall the previous session closed at $78.74 per barrel.

Meanwhile, supply factors stemming from major producers reducing output and escalating geopolitical tensions in the Red Sea and the Middle East limit the fall in oil prices. #Oil Prices Fall as China Plans 5% GDP Growth Naira Suffers Big, CBN Goes Ballistic Against FX Whales