Crude Oil Prices Soften on Renewed Trade Concerns
NYMEX WTI Crude Oil prices settled modestly lower Monday, as gains on expectations for steep losses of Iranian Crude Oil were offset by fears that rising US-China tensions could soften global demand.
On the New York Merc, Crude Oil futures for November delivery fell 19c to trade at 68.58 bbl, while on London’s Intercontinental Exchange, ICE Brent Crude fell 0.15% to trade at 77.97 bbl.
President Donald Trump announced new 10% tariffs on $200-B in Chinese goods after the stock market close Monday.
Trade war tensions were compounded somewhat after top White House economic adviser Larry Kudlow said Monday, China’s economic reforms were moving in the wrong direction, adding that he expected the United States would soon announce additional tariffs on Chinese goods.
China reportedly said it would reject new trade talks if President Trump moves ahead with the next round of US tariffs on Chinese products.
Many fear a trade war between the U.S. and China, the world’s largest 2 economies would slow global growth, reining in demand for Crude Oil.
Crude Oil prices made a positive start to the week before turning negative as investors renewed bets on a global Crude Oil supply shortage due to signs of falling demand for Iranian Crude Oil as US sanctions on Tehran loom.
SKorean imports of Iranian Crude Oil fell in August to just 55,161 BPD, down 72% from July levels, according to a report from Platts.
President Trump pulled the US out of the Iran nuclear agreement in May, allowing sanctions against Iran to snap back into place. The 1st wave of sanctions went into effect last month and a 2nd set of sanctions on Iran’s Crude Oil exports are slated for early November.
The subdued start to the week for Crude Oil prices comes as oil-market observers look ahead to the weekend meeting in Algiers between Key OPEC countries and Russia for clues on whether the major producers will continue to ramp up production to offset the loss of Iranian Crude Oil exports.
I believe they will as President Trump has all of the leverage in here.
|HeffX-LTN Analysis on USO:||Overall||Short||Intermediate||Long|
|Neutral (0.24)||Neutral (0.03)||Neutral (0.21)||Bullish (0.49)|
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