Brent Price Slides to $92 over Weak Demand
Brent crude futures bottomed around the $92 per barrel level on Tuesday as global recession fears and weak oil demand, especially in China, outweighed support from tight supplies.
The prices of crude of various grades in the global market have been adjusting to new dynamics and uncertainties across the United States, Europe and others bellwether economies.
US private sector activity contracted for the fourth consecutive month in October, signalling that stubbornly high inflation and tighter financial conditions are already impacting the economy.
On top of that, Chinese customs data showed that demand from the world’s largest crude importer remained subdued in September as persistent coronavirus-induced restrictions and fuel export curbs suppressed consumption.
Though China reported about 4 percent gross domestic product growth in the third quarter and there is an expectation that the inflation rate will slow down in the United States.
The organisation of Petroleum Exporting Countries (OPEC) and its allies, including Russia, agreed to cut production by 2 million barrels per day in November. READ:Brent Price Slides to $60.73 as OPEC, IEA Project Low Demand
Trading data indicates that the level of production volume cut was the most significant curb since the start of the pandemic, while speculation grows that the oil cartel will further intervene in markets to shore up prices.
In Africa, Angola has outpaced Nigeria as the largest crude oil exporter in the region after persistent production volume by the most populous country in the bloc.
Nigeria’s crude oil production volume has been trending behind OPEC quotas as large portion of the nation’s capacity have been stolen by oil thieves.
A looming European Union ban on Russian crude also exacerbated concerns about tight supplies. However, President Joe Biden has remained resolute to ensure the energy crisis that pushed prices higher ease by releasing from Strategic Petroleum Reserves.
# Brent Price Slides to $92 over Weak Demand#
