Oil prices fell on Friday, weighed down by fears about lacklustre demand in China, the world's top petroleum importer, as its economic recovery continues slow.
Brent crude futures fell by 65 cents, or 0.9%, to $71.91 a barrel, while US West Texas Intermediate crude fell 62 cents, or 0.9%, to $68.08.
According to Reuters, Brent is predicted to fall 2.7% this week and WTI by 3.3%.
"While oil prices have somewhat stabilised around the $71.00 level of support this week, the absence of a concrete bullish catalyst suggests that price recovery remains tepid for the time being," Yeap Jun Rong, market strategist at IG, said.
Yeah added that the prospect of rising oil supplies from both the United States and OPEC+, combined with continuing uncertainty about China's economic recovery, continues to cause market anxieties.
In October, China's oil refiners processed 4.6% less crude than the same month last year, marking the seventh consecutive month of year-over-year drop.
According to data issued on Friday by the National Bureau of Statistics, the reduction was driven by plant closures and reduced operating rates at smaller independent refineries.
According to government data, the reduction in refining activity coincided with a slowing of China's factory output growth and persistent issues in the country's real estate sector, despite an increase in consumer expenditure.
Yeap also cited statements by U.S. Federal Reserve Chair Jerome Powell on Thursday, which suggested that the Fed does not see the need to accelerate interest rate decreases.
A slower pace of rate cuts might hinder economic growth and decrease fuel demand.
This, in turn, promotes a higher US currency, making dollar-denominated crude more expensive for buyers in other currencies.
Oil prices also fell this week, as key analysts indicated that market fundamentals remained pessimistic.
The International Energy Agency predicted that global oil supply would exceed demand by 2025, even if OPEC+ maintained its production limits.
This imbalance is predicted to be caused by increased supply in the United States and other non-OPEC producers, which will most likely outpace slow demand growth.
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