Adedapo Adesanya
By Adedapo Adesanya
Oil prices dropped slightly on Friday night, October 18, 2019 after rising as concern over an economic slowdown in China, was countered by bullish signals from both the Chinese and US refining sectors.
Earlier on Friday, global benchmark Brent crude oil futures rose to $60.01 per barrel and US West Texas Intermediate (WTI) crude futures edged to $54.19.
However, on Friday night, the Brent crude dropped 58 cents or 0.97 percent to close at $59.33 per barrel, while the US West Texas Intermediate (WTI) crude lost 15 cents or 0.28 percent to settle at $53.78 per barrel.
China is the world’s biggest oil consumer and its economic growth slowed to 6 percent year on year, making it the weakest in over 27 years performing below expectations as a result of trade tensions with the United States.
Optimism for the trade deal had drove crude prices last weekend but has since reversed to trade lower as demand fears persist.
China, however still wants to hold further talks with the United States before signing what Trump referred to as “phase one” of the trade deal.
In the United States, falling product stocks countered higher US crude oil stocks, which rose by 9.3 million barrels in the week to October 11 which exceeded expectations for an increase of 2.9 million barrels.
Also, a global oil production agreement between the Organization of the Petroleum Exporting Countries (OPEC) and its allies also found that compliance is being exceeded, with cuts for September representing 236 percent of agreed quotas.
OPEC and its allies, including Russia, have agreed to limit oil output by 1.2 million barrels per day until March 2020.
OPEC lowered its 2019 global oil demand growth forecast to 0.98 million barrels per day while leaving its 2020 demand growth estimate unchanged at 1.08 million barrel per day according to its latest monthly report.
