Oil prices were flat on Thursday, holding on to overnight gains after positive trade data in China and U.S. data showed a smaller-than-expected increase in crude inventories and a large decline in fuel inventories.
Brent crude futures fell 4 cents to $82.92 per barrel as of 04:32 GMT, while WTI crude oil futures fell 1 cent to $79.12 per barrel.
China’s import and export growth remained below forecasts. However, China’s positive trade balance data is a constructive sign for the oil market’s demand outlook.
By the way, risk aversion dominates financial markets as stocks pull back on Wall Street.
The world’s largest crude importer China saw a 5.1% increase in imports in the first two months of 2024 from a year earlier to nearly 10.74 million barrels per day (bpd), customs data showed on Thursday, as refiners increased crude purchases to meet fuel sales.
While China’s January-February crude imports increased on an annual basis, fuel product exports decreased on an annual basis. China’s January-February refined product exports decreased by 30.6% yearly to 8.82 million tons, reducing the supply to global markets.
Upbeat trade data from China, the world’s second-largest economy, suggests that global trade is encouraging for policymakers trying to support a struggling economic recovery.
Brent and WTI rose nearly 1% on Wednesday, with U.S. crude oil inventories rising by 1.4 million barrels for the sixth straight week, lower than analysts’ expectations, EIA data showed. It was observed that gasoline and distillate stocks fell more than expected.
The strong US dollar will maintain the status quo soon as we brace for the risk that the US Federal Reserve’s first interest rate cut will be postponed until the second half of this year.
Fed Chairman Jerome Powell said the US central bank will hold off on lowering its benchmark interest rate this year because it is not sure inflation will continue to advance.
