Chinese Concerns Send Crude Oil Lower
The rally in Crude Oil ended in Asian trading after a series of weak data releases from China and Japan ended the risk sentiment amongst Oil and Equity traders.
Having jumped to over $40 a barrel in Monday’s trading, the news that Chinese exports fell to their lowest levels since 2009, coupled with very disappointing data from Japan, raised fears that the Chinese economic slowdown will hit future demand for Crude Oil.
The rally in oil was sparked by Russia and Saudi Arabia agreeing to reduce production levels as fears escalated that the lifting of Iranian sanctions would add another 500,000 barrels of crude oil a day to an already saturated market. China, the world’s second largest consumer of oil, has been on a strong economic downward trend which has heightened fears that future demand will drop off further at a time when supply levels look set to increase too.
At time of writing, Crude Oil was down 1.11% or $0.42, to trade at $37.48 a barrel. The price is fast approaching the 1st support level at $37.42 with the 1st resistance level set at $37.55.
Later today we can expect the API crude oil stock figures. The American Petroleum Institute reports inventory levels of US crude oil, gasoline and distillates stocks and a large decline has been forecast by investors. Should that not be the case, expect Crude Oil prices to fall even further.
Latest posts by Daniel Simmons (see all)
- 4 Things to Know in Monday’s Market - September 12, 2016
- 4 Things to Know in Thursday’s Market - September 8, 2016
- 4 Things to Know as EOG Resources Merges With Yates Petroleum in $2.5 Billion Deal - September 7, 2016