Oil prices slid on Monday after China posted its slowest quarterly economic growth in at least 27 years, reinforcing considerations about the requirement in the world’s largest crude oil importer. Brent crude futures for September fell 21 cents to $ 66.51 a barrel by 0222 GMT whereas U.S. crude for August was down 28 cents at $ 59.93 a barrel. Both contracts last week posted their biggest weekly gains in 3 weeks on cuts in U.S. oil production & diplomatic tensions in the Middle East.
Refineries in the way of Tropical Storm Barry continued to operate despite flood threats while the storm has slashed U.S. Gulf of Mexico crude output by 73%, or 1.38 million barrels per day. An unwinding of the danger premium from tropical storm Barry, lower oil demand forecasts and a lack of news from the Middle East could have led to a muted oil price response, Stephen Innes, managing partner at Bangkok-based Vanguard Markets, stated.
China’s economic growth slowed to 6.2% in the second quarter from a year earlier, according to analysts’ expectations, with demand at home and abroad faltering as the Sino-U.S. trade war bites. Nonetheless, China’s industrial output and retail sales beat forecasts, “suggesting that the economic system in China is healthier than we previously been pricing,” stated Michael McCarthy, chief market strategist at CMC Markets in Sydney.
Iranian President Hassan Rouhani stated in a televised speech on Sunday that Iran is able to maintain talks with the USA if Washington lifts sanctions & returns to the 2015 nuclear deal it quit last year. Meanwhile, Britain has provided to facilitate the release of the detained Iranian oil tanker Grace 1 if Tehran gave ensures that it might not go to Syria.