Oil prices rebound

Oil1Oil prices recovered Tuesday around half of the previous day’s losses that had been caused by renewed concerns surrounding the slowing Chinese economy and its impact on crude demand.

US benchmark West Texas Intermediate for delivery in November climbed 52 cents to $44.95 a barrel compared with Monday’s close.

Brent North Sea crude for November delivery won 71 cents to stand at $48.05 a barrel in early London afternoon deals.

Oil prices had dropped by more than a dollar on Monday owing to disappointing industrial sector data out of China, the latest sign of weakness in the world’s largest energy consumer.

Demand for crude has been hit hard by a slowdown in China.

Data this week showed profits at China’s major industrial companies fell almost nine percent in August from a year ago, the biggest decline since 2011.

It comes after data last week showed that Chinese factory activity shrank at its fastest pace in six and a half years this month.

As demand falters, the oil market is being rattled by the prospects of Iran exporting more crude if it is found to have complied with the terms of a deal signed in July to curb the country’s nuclear programme.

International inspection of Iran’s nuclear facilities is underway and compliance would lead to a lifting of crippling economic sanctions which have restricted its crude exports.

Analysts say Iran can ramp up exports within months after the sanctions are lifted, adding more oil to the oversupplied market.

Receive News Alerts on Whatsapp: +2348136370421

No Comments yet