Home / TIPS / MTECHTIPS:-Oil prices dip on weaker China data as demand stalls

MTECHTIPS:-Oil prices dip on weaker China data as demand stalls

MTECHTIPS:-Oil prices dip on weaker China data as demand stalls

Oil prices fell on Monday as weaker-than-expected Chinese data weighed on markets, adding to concerns that declining global demand would exacerbate a surplus of crude. Traders are also waiting to see whether the U.S. central bank raises interest rates for the first time in nearly a decade later this week. Should interest rates rise, analysts expect oil to fall as a stronger dollar would undermine demand from importing countries. Oil prices have fallen almost 60 percent since June 2014 on the back of the largest global surplus in modern times and concerns about a slowing Chinese economy. Growth in China’s investment and factory output missed forecasts in August. A recent run of weak data from the world’s second-largest economy has raised the chances that third-quarter economic growth may dip below 7 percent for the first time since the financial crisis. “There has been a very broad-based reaction to China across commodities, industrial metals and equities,” SEB chief commodities analyst Bjarne Schieldrop said. Front-month Brent crude futures (LCOc1) were down 59 cents at $47.55 a barrel by 0830 GMT. U.S. crude futures (CLc1) were down 21 cents at $44.42 a barrel. The International Energy Agency said last week that ongoing production cuts would lead to a rebalancing of the oil market by next year. The U.S. oil rig count fell by 10 to 652 last week, the second straight weekly drop.

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