Crude prices ease as investors monitor banking crisis and Chinese demand
Oil falls after Monday’s rally, but dip-buys in crude could be the prevailing trend in the near term, says analyst
28 March 2023 - 07:59
byLaura Sanicola and Sudarshan Varadhan
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Crude prices retreated on Tuesday after rallying the previous session, with markets focused on developments in the banking crisis and indications of strengthening demand in China.
Prices eased after rising at the fastest pace in more than four months on Monday. West Texas Intermediate (WTI) US crude fell 4c, or 0.05%, to $72.77 a barrel. Brent crude futures dropped 30c to $77.82 by 3.12am GMT.
“Though risks remain in the banking system amid the recent event, dip-buys in crude oil could be the prevailing trend in the near term,” said Tina Teng, an analyst at CMC Markets.
Prices rose in the previous session after Turkey stopped pumping crude from Kurdistan via a pipeline following an arbitration decision that confirmed Baghdad’s consent was needed to ship the oil.
Monday’s announcement that First Citizens Bancshares will acquire deposits and loans of failed Silicon Valley Bank (SVB) spurred optimism about the condition of the banking sector that has roiled financial markets.
Oil prices were also likely to continue drawing support from indications of recovering Chinese demand.
China’s crude oil imports are expected to rise 6.2% in 2023 to 540-million tonnes, according to an annual forecast by a research unit of China National Petroleum Corp (CNPC) on Monday.
“China’s manufacturing and services PMIs will be a major economic driver to oil prices as positive data is most likely to further improve the demand outlook,” Teng said.
US crude oil stockpiles were seen rising about 200,000 barrels last week, a preliminary Reuters poll showed on Monday.
The American Petroleum Institute (API), an industry group, will publish its inventory data at 4.30pm. EDT on Tuesday and the US Energy Information Administration (EIA) at 10.30am on Wednesday.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Crude prices ease as investors monitor banking crisis and Chinese demand
Oil falls after Monday’s rally, but dip-buys in crude could be the prevailing trend in the near term, says analyst
Crude prices retreated on Tuesday after rallying the previous session, with markets focused on developments in the banking crisis and indications of strengthening demand in China.
Prices eased after rising at the fastest pace in more than four months on Monday. West Texas Intermediate (WTI) US crude fell 4c, or 0.05%, to $72.77 a barrel. Brent crude futures dropped 30c to $77.82 by 3.12am GMT.
“Though risks remain in the banking system amid the recent event, dip-buys in crude oil could be the prevailing trend in the near term,” said Tina Teng, an analyst at CMC Markets.
Prices rose in the previous session after Turkey stopped pumping crude from Kurdistan via a pipeline following an arbitration decision that confirmed Baghdad’s consent was needed to ship the oil.
Monday’s announcement that First Citizens Bancshares will acquire deposits and loans of failed Silicon Valley Bank (SVB) spurred optimism about the condition of the banking sector that has roiled financial markets.
Oil prices were also likely to continue drawing support from indications of recovering Chinese demand.
China’s crude oil imports are expected to rise 6.2% in 2023 to 540-million tonnes, according to an annual forecast by a research unit of China National Petroleum Corp (CNPC) on Monday.
“China’s manufacturing and services PMIs will be a major economic driver to oil prices as positive data is most likely to further improve the demand outlook,” Teng said.
US crude oil stockpiles were seen rising about 200,000 barrels last week, a preliminary Reuters poll showed on Monday.
The American Petroleum Institute (API), an industry group, will publish its inventory data at 4.30pm. EDT on Tuesday and the US Energy Information Administration (EIA) at 10.30am on Wednesday.
Reuters
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