Oil prices fell more than 1% on Monday after data from China showed demand from the world’s largest importer of crude oil was sluggish in September as tight COVID-19 policies and fuel exports weighed on consumption.
Brent crude futures for the December settlement fell $1 per barrel, or 1.1%, to $92.50 as of 0609 GMT, after gaining 2% last week. West Texas Intermediate (WTI) crude for December delivery was down $1.03, or 1.2%, at $84.02 a barrel.
China’s crude oil imports of 9.79 million barrels per day in September were down 2% according to a year earlier, although higher than in August, customs data showed on Monday. That’s because independent refineries slashed production due to weak margins and sluggish demand.
The recent recovery in oil imports stalled in September. Independent refiners were unable to use the increased quotas as the ongoing COVID-related lockdowns put pressure on demand. This was exacerbated by declining refinery margins and restrictions on product exports.
While third-quarter gross domestic product (GDP) growth beat expectations, China’s zero-COVID policy and uncertainty over the property crisis undermined the effectiveness of pro-growth measures.
The GDP data comes a day after China’s Xi Jinping secured a third term of leadership on Sunday, cementing his position as the country’s most powerful ruler since Mao Zedong.
Brent rose last week despite announcing the sale of the remaining 15 million barrels of oil from the US Strategic Petroleum Reserves. This sale is part of record sales of 180 million barrels that began in May.
Biden added that his aim will be to replenish stocks when US crude oil is around $70 a barrel.
Baker Hughes Co said in a report Friday that US energy firms added oil and gas rigs for the second week in a row as relatively high oil prices encouraged firms to drill more.
