with change of trend, addition of analyst, context
London (awp/afp) – Oil prices are falling on Wednesday, after starting the session with a slight increase: the excess supply anticipated in the coming months remains the dominant factor on the market, due to demand Chinese at half mast.
Around 3:00 p.m. GMT (4:00 p.m. CET), the price of a barrel of Brent from the North Sea, for delivery in January, lost 1.35% to $70.92.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in December, fell 1.35% to $67.10.
“Despite Beijing's stimulus measures, Chinese growth should be lower than previous forecasts,” said Ricardo Evangelista, analyst at ActivTrades.
The slowdown in China, weighed down by sluggish consumption and a severe real estate crisis, adds to the bearish outlook for the oil market, the demand for black gold being strongly correlated with the economic health of the Asian giant, the world's leading importer of oil.
The Organization of the Petroleum Exporting Countries (OPEC) lowered its oil demand forecast on Tuesday for the fourth consecutive month, due to downward revisions to Chinese demand.
Since Donald Trump's victory in the American presidential election, black gold has also suffered from the appreciation of the dollar. The price of oil being expressed in dollars, “a stronger greenback makes it relatively more expensive for foreign buyers” and reduces demand, recalls Ricardo Evangelista.
The election of the Republican is a difficult factor for the markets to read. The president-elect is very supportive of fossil fuels, and investors expect favorable conditions for American producers, but his election thwarts efforts to accelerate the development of renewable energies and reduce fossil fuels.
“Nothing yet indicates that the use of fossil fuels has reached its maximum,” declared Professor Pierre Friedlingstein, of the British University of Exeter, on the third day of a COP29, where leaders of rich countries are reluctant to accelerate climate efforts.
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