WTI falls to $77.00 on falling Chinese oil imports-led demand concerns
|- WTI price extends its losing streak on demand concern following Chinese oil import data.
- China's oil imports fell to 10.8 million bpd in the first two months of the year, compared to 11.44 million bpd in December.
- Crude oil prices could find support from a weakening US Dollar amid growing expectations of a Fed rate cut in June.
The West Texas Intermediate (WTI) oil price has continued to decline for the third consecutive session, driven by data indicating a decrease in oil imports in China. Imports fell around 5.7% to 10.8 million barrels per day (bpd) in the first two months of the year, compared to 11.44 million bpd in December. The WTI price trades around $77.00 per barrel during the Asian hours on Monday.
Furthermore, the market is adopting a cautious stance ahead of the release of the Consumer Price Index data from the United States (US) scheduled for Tuesday. Investors will also closely monitor Retail Sales and Producer Price Index data expected on Thursday, which could provide fresh insights into the US economic situation amidst growing expectations of a Federal Reserve (Fed) interest rate cut in June.
The WTI price could find support from a weakening US Dollar (USD) following Federal Reserve (Fed) Chair Jerome Powell's testimony before the US Congress last week. Powell reiterated the central bank's stance and hinted at potential cuts in borrowing costs sometime this year, emphasizing that such actions would depend on the inflation trajectory aligning with the Fed's 2% target.
According to the CME FedWatch Tool, the probability of a rate cut in March and May has slightly decreased, with chances at 3.0% and 24.5%, respectively. However, the likelihood of a 25 basis points rate cut has increased to 57.2% for June.
Crude oil prices faced downward pressure due to concerns about demand, offsetting several factors. These include lower US oil stockpiles than expected for the week ending on March 1 and positive sentiment surrounding the Chinese economy, as highlighted by Trade Balance data.
Additionally, Saudi Arabia's unexpected decision to raise prices of its primary grade for buyers in Asia. Furthermore, market participants are closely monitoring ceasefire talks between Israel and Hamas, which have shown little progress.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.