© Archyde.com. A pump works in an oil field in Texas, USA, in a photo from Archyde.com archive.
HOUSTON (Archyde.com) – It fell 4 percent in volatile trading on Tuesday, dragged down by weak demand data from China, a bleak economic outlook and strong…
March crude futures fell $3.81, or 4.4 percent, to settle at $82.10 a barrel, the biggest daily drop in more than three months.
US crude fell $3.33 to $76.93 a barrel at settlement, after falling 4.1%, its biggest drop in more than a month. Both benchmarks rose a dollar a barrel early in the session.
“There are a lot of reasons for concern here, the COVID-19 situation in China and the fear of a recession in the foreseeable future is weighing on the markets,” said Robert Yawger, an analyst at Mizuho.
The Chinese government raised export quotas for refined petroleum products in the first shipment of 2023. Dealers attributed this increase to expectations of weak domestic demand while China, the world’s largest crude importer, is facing an increase in COVID-19 infections.
Factory activity in China also contracted as COVID-19 infections increased, which disrupted production and negatively affected demand after China lifted most anti-coronavirus restrictions.
Kristalina Georgieva, managing director of the International Monetary Fund, said on Sunday that the United States, Europe and China – the main engines of global growth – were all experiencing a simultaneous slowdown, adding to the pessimistic outlook.
Markets are awaiting more indications from the US Central Bank’s Monetary Policy Committee meeting on Wednesday. The US central bank raised interest rates by 50 basis points in December, after four consecutive increases of 75 basis points each.
(Prepared by Mahmoud Abdel-Gawad, Marwa Salam, Ayman Saad Muslim and Muhammad Ali Farag for the Arabic Bulletin – Edited by Ali Khafaji)