Crude oil prices fell early Monday due to Chinese concerns about weak demand. ANZ Bank said in a note that apparent oil demand in China declined 8% year on year in July, according to government data.
Other economic indicators released last week showed that the country’s industrial activity remains poor. Brent crude slid 0.5% to $79.25 per barrel, while West Texas Intermediate crude fell 0.6% to $76.17 per barrel as of early Monday.
Chinese data released this week indicated that new home prices declined at the highest rate in nine years, industrial production slowed, and the economy lost impetus in July as unemployment climbed.
According to data, industrial production remained below forecasts, increasing by 5.1% annually, while the jobless rate rose by 5.2%.
The possibility of a cease-fire in the Middle East, where the majority of global oil reserves are located, also aided the fall in oil prices, easing supply concerns in the markets.
For months, the US, Qatar, and Egypt have been trying to reach an agreement between Israel and Hamas to ensure a prisoner exchange and cease-fire and allow humanitarian aid to enter Gaza.
US Secretary of State Antony Blinken arrived in Israel on Sunday evening to advance efforts to reach a Gaza cease-fire and prisoner swap deal with Hamas.
US President Joe Biden said Sunday he believes that a cease-fire in the Gaza Strip is ‘still possible.’ The talks are ‘still underway. We’re not giving up. (It’s) still possible,’ Biden told reporters.
While, cease-fire talks in the Qatari capital, Doha, concluded on Friday without a breakthrough, but the US presented a fresh proposal that ‘builds on areas of agreement’ and bridges remaining gaps in a manner that allows for ‘a swift implementation of the deal.’
Meanwhile, though the White House said talks about a potential Gaza ceasefire agreement have been serious and constructive, tensions remain high with Hezbollah having launched rockets at Israel over the weekend, ANZ Bank said.
Also augmenting fears of short-term supply disruptions, a La Nina weather system could soon impact the Gulf of Mexico, the bank said.
