The price of West Texas Intermediate (WTI) Crude Oil has fallen to just above $74.00, driven by concerns over lower demand from China, the world’s largest Oil consumer. Despite supply disruptions in Libya and geopolitical risks in the region, WTI continues to decline.
The Chinese economy’s slowdown is impacting demand for Crude Oil, as the country shifts towards green energy and electric vehicles. This structural change, along with macroeconomic factors, is expected to affect Oil markets in the coming years.
In Libya, the Sarir Oil field has stopped production due to political unrest, further contributing to the supply concerns. Additionally, speculation that OPEC+ will increase production to lower Oil prices and compete with US shale producers is also weighing on WTI.
If OPEC+ does decide to boost production, it could result in a gradual decline in Oil prices, setting a new equilibrium rate for the market. However, bullish factors may counteract this decline, such as US monetary policy and declining Crude Oil inventories in the United States.
Overall, the current market trends suggest that WTI prices may continue to face downward pressure, with potential impacts on global Oil markets and investments.
