Advertisements
Home News Oil Prices Stabilize Amid Dollar and China Concerns

Oil Prices Stabilize Amid Dollar and China Concerns

by Barbara

Oil prices stabilized following a brief downturn in subdued summer trading, as market focus shifted towards the US dollar and developments in China. Brent crude hovered below $85 per barrel after experiencing a 0.6% decline over the past two sessions, while West Texas Intermediate traded near $82. The strength of the US currency received a boost on Monday in the aftermath of an attempt on the life of US presidential candidate Donald Trump, posing challenges for commodities including oil.

Federal Reserve Chair Jerome Powell’s remarks, indicating increased confidence among policymakers regarding inflation control, suggested potential reductions in borrowing costs and a weakening dollar ahead.

Advertisements

Throughout the year, crude oil prices have been supported by supply cuts by OPEC+ and anticipation of interest rate cuts in the US. However, concerns persist over China, where economic growth unexpectedly slowed to its weakest level in five quarters during the second quarter. The Third Plenum, currently underway, will shape China’s economic and political policies in the coming period.

Advertisements

Vivek Dhar, an analyst at Commonwealth Bank of Australia, noted that China’s economic slowdown indicates fragile consumer confidence, likely exerting downward pressure on oil prices. Despite the ongoing Third Plenum, significant policy reforms are not anticipated given the current economic conditions in China.

Advertisements
Advertisements

Oil markets have seen diminished volatility, with Brent’s implied volatility — a measure linked to options pricing and indicative of crude’s expected movements — reaching lows not seen since 2015.

Advertisements

 

You may also like

Rckir is a comprehensive financial portal. The main columns include foreign exchange wealth management, futures wealth management, gold wealth management, stock wealth management, fund wealth management, insurance wealth management, trust wealth management, wealth management knowledge, etc.

【Contact us: [email protected]

© 2023 Copyright Rckir.com [[email protected]]