Thursday, September 21, 2023

Texas oil opens 0.12% lower to US$80.62 a barrel

The price of a barrel of Texas intermediate oil (WTI) opened down 0.12% to US$80.62 a barrel as investors keep their eyes on the Chinese economy and the next steps in the US Federal Reserve (Fed)

At 09:00 local time, the futures contracts of the WTI for delivery in October lost US$0.10 with respect to the close of the previous day.

Yesterday the price of the benchmark crude ended down due to doubts about the chinese economy and the path of rates of the Federal Reserve (Fed).

On Monday, the People’s Bank of China (BPC) announced that it was lowering its reference rate for loans by ten basic points, from 3.55% to 3.45%, thus undertaking the second reduction this year, although it has been less aggressive than estimated

The decision comes after some indicators that point to a weak evolution of the Chinese economy and that are added to a worrying situation of the real estate of the country, especially after the bankruptcy of the giant Evergrande.

The possibility of this affecting the fuel demand of the country, which is one of the largest consumers in the world, is weighing on the market.

This week, in addition, investors are awaiting the meeting of central bankers on Friday in jackson holewhere the president of the Fed, Jerome Powell, will intervene in search of clues about the foreseeable new increases in interest rates.

As Tom Essaye points out in his analysis of The Sevens Report, “going forward, the Petroleum is at an inflection point as futures struggle to hold on to the recent price breakout and odds rise for WTI to retrace to the familiar 2023 trading range of $67-$83 per barrel.”


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