Oil prices fall amid weak demand signals from China

(MENAFN) Oil prices experienced a decline of approximately 2 percent at the close of trading on Friday, with Brent crude dropping below USD80 per barrel. Brent crude futures fell by USD1.36, or 1.7 percent, settling at USD79.68 per barrel, while U.S. West Texas Intermediate (WTI) crude futures decreased by USD1.51, or 1.9 percent, to USD76.65 per barrel. The overall weekly performance showed little change, with Brent crude ending the previous week at USD79.66 and WTI crude at USD76.84.

The decline in oil prices was influenced by lower expectations for demand growth from China, the world's largest oil importer. Recent data from China indicated a slowdown in economic activity in July, with new home prices dropping at their fastest rate in nine years, slower industrial production, and a rising unemployment rate. This has heightened concerns about reduced oil demand as Chinese refineries significantly cut crude throughput due to decreased fuel consumption.

Additionally, both OPEC and the International Energy Agency (IEA) have adjusted their forecasts downward, citing weak demand prospects in China. Despite a brief rise in oil prices earlier in the week due to speculation over potential Iranian retaliation following the assassination of Hamas leader Ismail Haniyeh, the market remains cautious. Ongoing ceasefire talks in Gaza, which began in Qatar, will be paused until next week, adding further uncertainty to the global oil market. 

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