Investing
Oil treads water as markets weigh China optimism, Fed uncertainty
© Reuters.
Investing.com– Oil prices moved little on Friday and were set to close flat after a volatile week, as markets weighed optimism over robust demand in top crude importer China against uncertainty over more U.S. interest rate hikes.
China optimism helps crude reverse recent losses
Crude prices rallied on Thursday, recouping recent losses after data showed that refinery throughput in China rose 15.4% in May from the prior year, its second-highest level on record.
A series of interest rate cuts this week also boosted hopes for a Chinese economic recovery, which some market players have forecast will push crude demand to record highs.
But the rate cuts also came amid a string of weak economic readings from China, with both and rising less than expected in May.
were flat at $75.54 a barrel, while rose 0.2% to $70.52 a barrel by 21:13 ET (01:13 GMT). Both contracts were set to end the week between 0.4% and 1% higher.
Focus is now on a potential cut in China’s benchmark next week, which could unlock more monetary stimulus in the country as it struggles with a post-COVID recovery.
Fed uncertainty, weak economic data make for volatile week
Oil prices saw wild swings this week as optimism over China was largely countered by fears of rising interest rates in major economies and worsening global economic conditions.
The Federal Reserve had earlier this week , but signaled that it could raise rates at least two more times this year. This was followed by an by the European Central Bank, with the ECB also positing a hawkish outlook on future rate hikes.
Rising interest rates are expected to stymie economic activity this year, which markets fear could greatly dent crude demand.
These fears were compounded by weak economic readings from several major oil consumers this week. But signs of slowing growth also saw markets question just how much economic headroom global central banks had to keep raising interest rates.
Still, the outlook for oil remains uncertain as global economic conditions worsen. With demand remaining relatively weak, analysts expect oil supply to outpace demand this year, despite recent production cuts by the Organization of Petroleum Exporting Countries.
Read the full article here
-
Side Hustles5 days ago
Mark Zuckerberg Is Now Second Richest Person in the World
-
Investing5 days ago
Nvidia CEO Jensen Huang: Demand For Blackwell AI Is Insane
-
Side Hustles6 days ago
With AI Magicx, It’s Like Getting an Entire Creative Team in One Money-Saving AI Tool
-
Side Hustles6 days ago
How to Be Unapologetically You and Why It Matters
-
Side Hustles5 days ago
Meta Previews Movie Gen, AI Tools That Turn Dreams to Videos
-
Investing3 days ago
Hurricane Helene Hits Spruce Pine Mine, Quartz Used for Tech
-
Passive Income6 days ago
How AI-Driven Personalization Is Transforming the Retail Industry
-
Investing5 days ago
BCA says investors should fade the real estate rally By Investing.com