Tuesday's closing price for crude oil futures was the lowest since december 2021 as the market sell-off picked up steam following OPEC's second cut to its demand projection in as many months.
In a note sent to investors in the afternoon, Bob Yawger, executive director of energy futures at Mizuho Securities, stated, "Crude oil demand destruction one-two punch from china and OPEC delivered the knockout blow today."
Yawger remarked, "It's unbelievable how the market is falling while a hurricane or tropical storm churns up the US gulf of mexico oil patch."
While Tropical Storm Francine poses a threat to the production of gas and oil as well as refining activities along the gulf Coast, futures recovered some of the ground they had lost on monday and then turned negative.
OPEC's revised prediction indicates that demand will increase by around 2 million barrels per day in 2024, which is 80,000 bpd less than anticipated. The consortium of oil producers projects 1.7 million barrels of new demand growth in 2019, around 40,000 barrels less than they had predicted.
Owing to declining demand in china, the biggest crude importer in the world, OPEC lowered its demand forecast in August.
For months, concerns about China's decreasing demand amid a boom in sales of electric vehicles have hovered over the oil market. Additionally, Morgan Stanley and other market experts predict that OPEC+ will boost output in december, resulting in a surplus for 2025.
In 2024, China's imports of oil decreased by almost 3%, as to Yawger. He stated, "Since 2006, there have only been three years when China's annual imports of crude oil have decreased, and one of those years was Covid 2020."
In a note sent to investors in the afternoon, Bob Yawger, executive director of energy futures at Mizuho Securities, stated, "Crude oil demand destruction one-two punch from china and OPEC delivered the knockout blow today."
Yawger remarked, "It's unbelievable how the market is falling while a hurricane or tropical storm churns up the US gulf of mexico oil patch."
While Tropical Storm Francine poses a threat to the production of gas and oil as well as refining activities along the gulf Coast, futures recovered some of the ground they had lost on monday and then turned negative.
OPEC's revised prediction indicates that demand will increase by around 2 million barrels per day in 2024, which is 80,000 bpd less than anticipated. The consortium of oil producers projects 1.7 million barrels of new demand growth in 2019, around 40,000 barrels less than they had predicted.
Owing to declining demand in china, the biggest crude importer in the world, OPEC lowered its demand forecast in August.
For months, concerns about China's decreasing demand amid a boom in sales of electric vehicles have hovered over the oil market. Additionally, Morgan Stanley and other market experts predict that OPEC+ will boost output in december, resulting in a surplus for 2025.
In 2024, China's imports of oil decreased by almost 3%, as to Yawger. He stated, "Since 2006, there have only been three years when China's annual imports of crude oil have decreased, and one of those years was Covid 2020."
click and follow Indiaherald WhatsApp channel