Oil Prices Decline On Weak Us Demand

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Oil Prices Decline On Weak Us Demand

Oil Prices Decline On Weak Us Demand &Amp;Amp; Rising Chinese Output

Oil prices came under the grasp of bears once again during Monday's session after a survey showed weakness in US consumer demand. Similarly, the crude production in China increased during May 2024, which is negative for the oil.

That's why the Brent crude futures (Aug) slipped 0.5% or around $0.40 while the US WTI futures (Jul) declined by $0.36. The last trading price for the Brent crude futures was $82.22, while the WTI futures were seen near $78.09.

look at the WTI futures contract for August also shows a change of -0.5% and a trading price of $77.7. The decline in the oil is thanks to the US consumer sentiment which has refreshed 7-month lows. The survey showed that US households are worried about inflation and personal finances.

Oil Contracts Gained 4% In Previous Week

However, both of these future contracts gained 4% in the previous week, which is the highest percentage gain since April. According to a senior market analyst, the OPEC+ forecast shows a strong demand and that's fueled the rally in the oil last week.

However, the falling consumer confidence in the USA dealt a major blow to the upside in the US oil prices which has now turned negative in the short-term. The US consumers are struggling with higher rates as the cost of living continues to increase.

Meanwhile, the crude oil production in China showed a 0.6% increase which makes it roughly around 18.15 million tons.

The bottom line is that consumer confidence in the US has been linked to new lows, which is not good for the oil market. Similarly, an uptick in Chinese crude oil output (domestic) means China will now import less crude oil from the OPEC and OPEC+ members.

The overall picture means more downside for the Oil prices but any sudden actions from the OPEC or OPEC+ could change the situation.

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