Commodities and Futures News

Oil prices rise as tight supply, China stimulus offsets Fed jitters

2023.07.24 21:55


© Reuters.

Investing.com– Oil prices rose slightly in Asian trade on Tuesday, sticking to three-month highs as signs of tighter supply and expectations of more Chinese stimulus helped offset uncertainty over an upcoming Federal Reserve meeting.

Crude prices saw a strong start to the week, rising over 2% after top Chinese officials pledged to spruce up economic growth in the world’s largest oil importer. 

This came amid tighter global crude supplies, as the effects of recent production cuts by the Organization of Petroleum Exporting Countries and Russia began to be felt. 

rose 0.1% to $82.70 a barrel, while rose 0.4% to $79.03 a barrel by 21:12 ET (01:12 GMT). 

China stimulus in focus as economic recovery cools 

China’s Politburo- the ruling Communist Party’s top decision-making body- vowed to roll out more supportive measures for the economy in the coming months, after recent data showed that growth slowed sharply in the second quarter.

The move pushed up hopes that oil consumption in the world’s largest importer will improve this year. While China has imported nearly record amounts of crude so far in 2023, fuel demand in the country has struggled to reach pre-COVID levels.

This trend had also largely undermined bets that a recovery in China will drive global oil demand to record highs in 2023.

But more stimulus measures could still result in such a scenario, especially as the government promotes private investment and spending in the country. 

U.S. inventory data on tap

Oil markets were also focused on , which is due later on Tuesday and Wednesday. Inventories are expected to have fallen by over 2 million barrels in the week to July 21, indicating some steady demand.

But indicators of U.S. fuel consumption will be closely watched, amid some concerns over sluggish demand in the world’s largest oil consumer. Extreme weather conditions and high inflation have somewhat weighed on fuel demand in recent weeks. 

Fed rate hike, outlook awaited 

Gains in oil markets were limited on Tuesday as markets awaited a Fed decision on interest rates. The central bank is widely expected to at the conclusion of a two-day meeting this Wednesday. 

While the hike appears to be largely priced in by markets, focus is squarely on whether the bank will signal more raises or an end to its nearly 16 month-long rate hike cycle. 

Any indications of higher rates bode poorly for the world’s largest economy, and could potentially stymie oil demand as economic activity slows.

Data released this week already pointed to worsening business activity in the world’s largest economies. 

Source link

Related Articles

Back to top button
bitcoin
Bitcoin (BTC) $ 74,852.05 1.42%
ethereum
Ethereum (ETH) $ 2,814.04 7.42%
tether
Tether (USDT) $ 1.00 0.09%
solana
Solana (SOL) $ 186.94 0.03%
bnb
BNB (BNB) $ 591.47 1.72%
usd-coin
USDC (USDC) $ 1.00 0.00%
xrp
XRP (XRP) $ 0.545078 2.52%
staked-ether
Lido Staked Ether (STETH) $ 2,812.39 7.27%
dogecoin
Dogecoin (DOGE) $ 0.186861 5.46%
tron
TRON (TRX) $ 0.160219 2.02%
cardano
Cardano (ADA) $ 0.372917 4.52%
the-open-network
Toncoin (TON) $ 4.85 3.39%
wrapped-steth
Wrapped stETH (WSTETH) $ 3,329.14 7.18%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 74,748.03 1.38%
shiba-inu
Shiba Inu (SHIB) $ 0.000019 1.90%
avalanche-2
Avalanche (AVAX) $ 26.76 1.08%
weth
WETH (WETH) $ 2,813.11 7.33%
chainlink
Chainlink (LINK) $ 12.20 3.69%
bitcoin-cash
Bitcoin Cash (BCH) $ 375.63 2.45%
sui
Sui (SUI) $ 2.25 1.71%
polkadot
Polkadot (DOT) $ 4.07 0.08%
leo-token
LEO Token (LEO) $ 6.22 0.69%
usds
USDS (USDS) $ 0.996513 0.68%
uniswap
Uniswap (UNI) $ 8.97 1.59%
litecoin
Litecoin (LTC) $ 70.63 1.14%
wrapped-eeth
Wrapped eETH (WEETH) $ 2,959.48 7.62%
near
NEAR Protocol (NEAR) $ 4.13 0.22%
aptos
Aptos (APT) $ 9.63 3.30%
pepe
Pepe (PEPE) $ 0.00001 8.49%
bittensor
Bittensor (TAO) $ 508.62 2.84%
fetch-ai
Artificial Superintelligence Alliance (FET) $ 1.39 0.31%
internet-computer
Internet Computer (ICP) $ 7.61 0.56%
dai
Dai (DAI) $ 1.00 0.19%
monero
Monero (XMR) $ 164.66 1.82%
ethereum-classic
Ethereum Classic (ETC) $ 19.81 3.73%
stellar
Stellar (XLM) $ 0.098563 2.15%
kaspa
Kaspa (KAS) $ 0.11697 0.64%
ethena-usde
Ethena USDe (USDE) $ 1.00 0.22%
whitebit
WhiteBIT Coin (WBT) $ 19.30 0.43%
aave
Aave (AAVE) $ 181.73 11.71%
polygon-ecosystem-token
POL (ex-MATIC) (POL) $ 0.339336 4.53%
blockstack
Stacks (STX) $ 1.65 0.15%
okb
OKB (OKB) $ 39.97 2.51%
first-digital-usd
First Digital USD (FDUSD) $ 1.00 0.26%
crypto-com-chain
Cronos (CRO) $ 0.086068 0.71%
dogwifcoin
dogwifhat (WIF) $ 2.29 3.29%
arbitrum
Arbitrum (ARB) $ 0.571088 9.60%
filecoin
Filecoin (FIL) $ 3.70 2.75%
mantle
Mantle (MNT) $ 0.627858 7.32%
celestia
Celestia (TIA) $ 5.06 6.86%