Crude falls on demand concerns

Oil prices fell sharply this Tuesday in a market distressed by a possible drop in demand due to the health situation in China and milder than normal temperatures in Europe and the United States.

North Sea Brent for March delivery lost 4.43% to $82.10, while West Texas intermediate (WTI) barrels for February fell 4.14% to $76.93.

The Mexican export mix, for its part, fell 5.55% to $65.84 a barrel, in what was its worst loss since September 2022.

“The impact of China fuels the debate in the market,” said John Kilduff of Again Capital. “Is it a reopening of economic activity, with a pick-up in demand, or will they first have to go through a difficult phase that will affect demand?”

Related Post

Oil Price Nears a Slide of 20% From High. Why It Keeps Falling.

June 23, 2023

Oil prices fall 2% due to weak economic data from China and the US

May 11, 2023

Oil prices extend losses due to fears of recession; Brent drops 2 dollars

April 20, 2023

Oil falls more than 1% due to fear of recession in the US and expectations of lower demand

April 13, 2023

British health risk analysis firm Airfinity estimates that the coronavirus has caused 161,800 deaths in China since December 1, and forecasts 1.8 million daily infections and 1.7 million deaths by the end of April.

The near-term outlook for the Chinese economy remains grim amid a mountain of Covid infections,” Duncan Wrigley of Pantheon Macroeconomics wrote in an analysis note.

Kilduff added the heat wave in Europe and part of the United States as a “negative” factor for demand in the dead of winter.

Compounding the gloomy outlook, IMF Managing Director Kristalina Georgieva said on Sunday that the economies of the United States, Europe and China, the main engines of global growth, were simultaneously slowing, making 2023 more difficult than 2022 for the world economy.