Oil prices fall as China demand outlook falters

The prices of crude oil plummeted more than 1 per cent on Monday for a third session, after official data revealed refining and economic activity slowed in China.

Brent crude was down 90 cents, or 1.3 per cent, at $69.69 a barrel by 0649 GMT. U.S. oil dropped by 97 cents, or 1.4 per cent, to $67.47 a barrel, Reuters reported.

In July, factory output and retail sales development slowed sharply in China, losing prospects as fresh outbreaks of COVID-19 and flooding disrupted business activity.

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Reuters quoted Commerzbank as saying “Concerns about the spread of the Delta variant in China and the effects this will have on oil demand are continuing to weigh on pREADrices”.

Reuters also quoted a market analyst at CMC Markets in Singapore, Kelvin Wong, as saying “Oil futures weakness is likely triggered by weaker than expected growth data from China, which is a major consumer of oil.”

“All in all, the global peak growth narrative has been intensified,” Mr Wong said.