Oil is heading to snap 7 weeks of gains due to China and interest

2023-08-18 04:08:51
Oil drilling rig – archive

Oil appeared to be heading to end a seven-week winning streak on Friday, due to concerns regarding demand growth in China as its economy slows and in light of the possibility that US interest rates will remain at high levels for an extended period.

There was little change in the two main benchmarks on Friday, as West Texas Intermediate crude rose ten cents, or 0.1 percent, to $80.49 a barrel, while Brent crude settled unchanged at $84.12 a barrel by 0205 GMT.

Oil prices are limited by the US Federal Reserve’s focus on containing inflation in light of stronger-than-expected economic data.

And the US Department of Labor announced, Thursday, that the number of Americans applying for unemployment benefits for the first time declined last week, in a sign that the labor market, which is still witnessing a scarcity of employment, may push the US central bank to continue its campaign to tighten monetary policy.

The report came on the heels of other strong economic reports, including the US retail sales report, all of which pointed to the possibility that the US central bank would stick to keeping interest rates high for an extended period.

Concerns were exacerbated by a new batch of Chinese data which indicated that the economy of the world’s second largest oil consumer has been losing momentum rapidly since the second quarter of the year.

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