Crude Oil Futures Face Pressures Amid China Slowdown And US Data

(MENAFN- Investor Ideas) Crude oil futures could return to their decline as concerns about slowing global demand, especially from China, continue to weigh on expectations. China's weaker demand could continue due to a softer economic performance and a shift towards electric vehicles (EVs) and LNG-fuelled trucks, reducing diesel demand. Concerns about the direction of the US economy could also create risks for oil markets.

In this regard, traders could monitor economic data release and could react accordingly. This week is busy with data publications, with market participants looking forward to inflation data and crude inventory figures.

U.S. crude oil inventories have declined for the past three weeks, with a significant drop of 6.9 million barrels in the last week of August, exceeding market expectations of a 1.1-million-barrel draw. The market could react strongly to another surprise drawdown while the global mood remains pessimistic.

On the economic front, US core Inflation is expected to remain steady at 3.2% year-on-year in August, while the overall inflation rate is projected to ease to 2.6% from 2.9%. Lower inflation could boost interest rate cuts expectations and the potential for a stronger economy and higher US oil demand.

MENAFN10092024000142011025ID1108659086