July 11, 2023 (MLN): Oil prices rose slightly as the market assessed the outlook for demand after China’s measures to support its struggling property market.
Brent crude is currently trading at $78.25 per barrel, up by 0.47% on the day.
While West Texas Intermediate crude (WTI) is trading at $73.3 per barrel, up by 0.44% on the day.
It is worth noting that this decline comes after Brent crude marked a surge of 4.01% following a pledge by Saudi Arabia and Russia to reduce supply.
Authorities stepped up pressure on banks to ease terms for property companies by encouraging negotiations to extend outstanding loans, Bloomberg reported.
Top state-run financial newspapers on Tuesday ran reports flagging the likely adoption of further supportive policies.
China’s sluggish economic recovery, along with monetary tightening by central banks and resilient crude flows from producers including Russia and Iran have provided headwinds for oil this year.
That has prompted OPEC+ heavyweights Saudi Arabia and Russia to cut supply to prop up prices.
Market participants are now monitoring the upcoming U.S. Consumer Price Index (CPI) figures for June due to be released on Wednesday, and monthly reports from OPEC and the International Energy Agency on Thursday for snapshots of the oil market.
Ahead of those releases, the US will provide its Short-Term Energy Outlook.
Warren Patterson, head of commodities strategy for ING Groep NV stated, “Saudi cuts and expectations of further support measures for the Chinese property sector appear to be providing a more solid floor to the market.”
