Crude oil prices slip on global growth con­cerns

Global Times US Edition - - BIZMARKETS -

Oil prices fell on Wed­nes­day, pulled down by swelling US in­ven­to­ries and a plunge in global stock mar­kets as China’s gov­ern­ment warned of in­creas­ing eco­nomic head­winds.

In­ter­na­tional Brent crude oil fu­tures LCOc1 were at $60.87 per bar­rel at 0508 GMT, down $1.21, or 2 per­cent, from their last close.

US West Texas In­ter­me­di­ate (WTI) crude fu­tures CLc1 were at $52.33 per bar­rel, down 92 cents, or 1.7 per­cent.

Reuters tech­ni­cal com­mod­ity an­a­lyst Wang Tao said WTI could soon test sup­port at $51.75 per bar­rel, while Brent was threat­en­ing to drop be­low $60 per bar­rel again soon.

Oil prices were pres­sured by a weekly re­port from the Amer­i­can Petroleum In­sti­tute (API) that said US crude in­ven­to­ries had risen by 5.4 mil­lion bar­rels in the week to Novem­ber 30 to 448 mil­lion bar­rels.

Of­fi­cial US gov­ern­ment oil pro­duc­tion and in­ven­tory data is due later on Wed­nes­day.

More broadly, the slide in US oil fol­lowed a tum­ble in global stock mar­kets on Tues­day, with in­vestors wor­ried about the threat of a wide­spread eco­nomic slow­down.

Key to the global eco­nomic out­look will be whether China and the US can re­solve their trade disputes. Wash­ing­ton and Beijing an­nounced a 90-day truce last week­end, dur­ing which nei­ther side will fur­ther in­crease pu­ni­tive im­port tar­iffs.

In a sign of eas­ing ten­sions be­tween the two world’s big­gest economies, Chi­nese oil trader Unipec plans to re­sume US crude ship­ments to China by March, peo­ple with knowl­edge of the mat­ter said.

Bank of Amer­ica Mer­rill Lynch said in its 2019 eco­nomic out­look, pub­lished on Tues­day, that “most ma­jor economies are likely to see de­cel­er­at­ing ac­tiv­ity,” although it added that “a steady stream of mon­e­tary and fis­cal stim­u­lus mea­sures” was ex­pected to stem the slow­down.

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