Oil Prices Fall Below $80 as Supply Risks Offset Weak Demand
Crude oil prices declined early on Monday over Chinese’s weak demand concerns China. Apparent oil demand in China fell 8% year-over-year in July, government data showed, ANZ Bank Said in a note.
Other economic data last week showed prevailing weak industrial activity in the country. Brent crude fell 0.5% to US$79.25 per barrel and West Texas Intermediate crude lost 0.6% to US$76.17 per barrel at last look early Monday.
Data from China last week showed that new home prices fell at the fastest rate in nine years, industrial production slowed and the economy lost momentum in July as unemployment rose.
According to data, industrial production remained below expectations with an annual increase of 5.1% and unemployment rate was above expectations with 5.2%.
The possibility of a cease-fire in the Middle East, where the majority of global oil reserves are located, also aided the fall in oil prices, easing supply concerns in the markets.
For months, the US, Qatar, and Egypt have been trying to reach an agreement between Israel and Hamas to ensure a prisoner exchange and cease-fire and allow humanitarian aid to enter Gaza.
US Secretary of State Antony Blinken arrived in Israel on Sunday evening to advance efforts to reach a Gaza cease-fire and prisoner swap deal with Hamas.
US President Joe Biden said Sunday he believes that a cease-fire in the Gaza Strip is ‘still possible.’ The talks are ‘still underway. We’re not giving up. (It’s) still possible,’ Biden told reporters.
While, cease-fire talks in the Qatari capital, Doha, concluded on Friday without a breakthrough, but the US presented a fresh proposal that ‘builds on areas of agreement’ and bridges remaining gaps in a manner that allows for ‘a swift implementation of the deal.’
Meanwhile, though the White House said talks about a potential Gaza ceasefire agreement have been serious and constructive, tensions remain high with Hezbollah having launched rockets at Israel over the weekend, ANZ Bank said.
Also augmenting fears of short-term supply disruptions, a La Nina weather system could soon impact the Gulf of Mexico, the bank said. #Oil Prices Fall Below $80 as Supply Risks Offset Weak Demand
