Oil Prices Hover at Two-Week Lows as OPEC Cuts Demand Outlook Again
Oil prices remained stagnant in Asian trade on Wednesday, staying near two-week lows as the OPEC slashed its demand forecast once more. The focus also shifted to potential stimulus measures in China, while concerns over the U.S. economy and speculation about a second term for President Donald Trump added to market uncertainty.
The recent drop in oil prices followed disappointing fiscal measures from China and reduced fears of supply disruptions in the Gulf of Mexico due to the dissipating tropical storm Rafael. Additionally, a stronger dollar, fueled by expectations of Trump’s policies, weighed on crude prices.
Brent crude futures for January delivery slipped to $71.86 a barrel, while WTI crude fell to $67.92 a barrel.
OPEC revised its global oil demand growth forecast for 2024, projecting a growth of 1.82 million barrels per day, down by 107,000 bpd from the previous month. The organization cited concerns over slowing demand in China and the shift towards cleaner fuels globally as reasons for the cut.
While OPEC remains relatively optimistic compared to other energy watchdogs like the International Energy Agency, the market awaits the IEA’s upcoming report on Thursday.
Investors are also closely watching China’s fiscal stimulus plans and the U.S. Consumer Price Index (CPI) data, which could influence the Federal Reserve’s interest rate decisions.
In conclusion, the oil market is currently influenced by OPEC’s demand outlook, China’s stimulus measures, and U.S. economic data. Understanding these factors can help individuals make informed decisions regarding their investments and financial strategies.