Oil prices fall on Chinese demand concerns, OPEC+ supply

September 03, 2024 10:23 PM AEST | By Investing

Oil prices fall on Chinese demand concerns, OPEC+ supply

Weak Chinese growth weighs

Crude markets have been on the retreat for the last three weeks, largely on concerns that demand in China, the world's largest importer, will struggle to grow for the remainder of this year as its economy struggles with the impact of a prolonged property crisis.

China reported weaker-than-expected manufacturing PMI over the weekend, and on Monday China reported new export orders fell for first time in eight months in July and that prices of new homes rose in August at their weakest pace this year.

Libyan supply hit

Oil exports from key Libyan ports were suspended on Monday, and production was reduced nationwide due to an ongoing dispute between rival political groups over the management of the central bank and oil revenue.

This disruption led Libya's National Oil Corp. (NOC) to declare force majeure on the El Feel oil field, effective since September 2.

Despite these disruptions, experts suggest that the impact may be limited. Libya's Arabian Gulf Oil Company managed to resume production at approximately 120,000 barrels per day on Sunday, aimed at powering the Hariga port's power plant.

OPEC+ to unwind cuts?

Traders are also waiting for supply news from the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, with the group scheduled to start adding output back to the market, starting in October, gradually unwinding the hefty cuts they have introduced to try and prop up the market.

"Given lingering demand concerns there had been a growing part of the market ... who thought the group would delay any supply increases. The group may believe that supply disruptions from Libya provide an opportunity to increase supply," said analysts at ING, in a note.

(Senad Karaahmetovic contributed to this article.)

This article first appeared in Investing.com

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (“Kalkine Media, we or us”), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary.
The content published on Kalkine Media also includes feeds sourced from third-party providers. Kalkine does not assert any ownership rights over the content provided by these third-party sources. The inclusion of such feeds on the Website is for informational purposes only. Kalkine does not guarantee the accuracy, completeness, or reliability of the content obtained from third-party feeds. Furthermore, Kalkine Media shall not be held liable for any errors, omissions, or inaccuracies in the content obtained from third-party feeds, nor for any damages or losses arising from the use of such content.
Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyrighted to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have made reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.
This disclaimer is subject to change without notice. Users are advised to review this disclaimer periodically for any updates or modifications.