The United States and China seem to be failing to increase demand. The effect of this is visible in crude oil prices. According to a Reuters report, crude oil from the Gulf countries has hit its lowest level in almost 3 years after December 2021. According to the report, the price of Brent crude oil has fallen below $70 per barrel. On the other hand, US crude oil prices have hit the lowest level since May 2023.
According to the report, OPEC has further reduced its oil demand estimates for the current and next year, due to which oil prices have fallen. If we look at the figures, there was a 13 percent drop in crude oil prices in the month of September. Let us also tell you what the price of crude oil has been today.
Gulf countries’ oil cheapest in 3 years
There has been a major drop in the price of crude oil, i.e. Brent crude oil of the Gulf countries. According to the data, during the trading session, a 4.38 percent drop in the prices of crude oil of the Gulf countries was observed. Due to which the prices have reached $68.69 per barrel. According to the report, for the first time since December 2021, crude oil of the Gulf countries has been below $70 per barrel. This means that the price of Brent crude oil has been seen at its lowest level. Currently, according to Indian time, the price of crude oil is quoted at $69.03 per barrel, with a drop of 3.91 percent. If we talk about the month of September, there has been a 13 percent drop in the price of Brent crude oil.
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US oil prices also plummeted
On the other hand, there is a huge drop in the price of US crude oil. According to the data, during the trading session, the price of US oil experienced a drop of 5 percent and the price reached 65.28 dollars per barrel. Which is the lowest after May 2023. However, currently the price of WTI is trading at 65.72 dollars per ounce with a drop of 4.35 percent. In the month of September, the price of US crude oil fell by more than 11 percent. According to experts, a further drop in the price of US crude oil is possible.
OPEC report has a big impact
OPEC+ has changed its demand forecast for this year and 2025. After OPEC made changes, Brent crude oil fell below $70 a barrel on Tuesday for the first time since December 2021. On Tuesday, the Organization of the Petroleum Exporting Countries (OPEC) said in a monthly report that global oil demand in 2024 will be 2.03 million barrels per day (bpd), down from last month’s forecast of 2.11 million bpd. As of last month, OPEC had not made any changes to the forecast. This is the first time since July 2023 that OPEC has made any changes to its demand estimates. OPEC lowered its global demand forecast for 2025 to 1.74 million bpd from 1.78 million bpd.
No demand in China
On Monday, Chinese data showed that inflation rose in August at the fastest pace in half a year, although domestic demand remained fragile. Due to increasing diesel and gasoline supplies, Asian refinery margins have fallen to their lowest level since 2020. Oil market strategist Clay Siegel said that there has been almost no increase in oil demand in developed economies this year. Fiscal stimulus in China has not boosted the manufacturing sector. This is one of the main reasons why diesel demand is declining in China. While data released on Tuesday showed that China’s exports grew in August at the fastest pace in almost a year and a half, a decline in domestic demand resulted in lower imports.
The United States is also a big reason
A similar situation is also being observed in the United States. The type of economic figures that have been seen in recent days have created many kinds of doubts. In which manufacturing and employment data are important. The effect of which can be seen in the interest rates of the Federal Reserve. The oil market is also waiting for the Federal Reserve meeting and the inflation data to be published on Wednesday. If the Federal Reserve increases interest rates by 25 basis points, the dollar index will rise and crude oil prices will fall further. If a 50 basis point drop is observed, then the dollar index will fall and the price of crude oil will rise. At present, there is also a decline in demand for oil in the United States. There is an increase in supply.
