Oil market is also broadly underpinned by supply cuts from OPEC+ group of producers, as Iraq’s oil ministry said at the weekend that it will compensate for overproduction since the beginning of 2024
Reuters LONDON
Oil held its ground on Monday as downward pressure from a stronger U.S. dollar and concern about demand in top importer China offset support from strong demand elsewhere and OPEC+ supply restraint.
The dollar firmed as trading on a victory by Donald Trump in the coming U.S. election gathered steam after an attempted assassination of the former U.S. President. A stronger dollar makes oil more expensive for buyers with other currencies and tends to weigh on oil prices.
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Brent crude futures were up 8 cents, or 0.1 per cent, at $85.11 a barrel by 1000 GMT. U.S. West Texas Intermediate crude gained 19 cents, or 0.2 per cent, to $82.40.
“Chinese data including refinery runs and crude imports are not supportive,” said UBS analyst Giovanni Staunovo. “But demand growth elsewhere is still healthy.”
Crude fell last week after four weeks of gains as hopes of strong U.S. summer demand were countered by concern over demand in China.
Chinese data on Monday added to that concern. The world’s second-largest economy grew by 4.7 per cent in the April to June quarter, official figures showed, the slowest growth since the first quarter of 2023.
On Friday separate figures showed China’s crude oil imports fell 2.3 per cent in the first half of this year.
However, the volatile situation in the Middle East continues to provide a geopolitical premium for oil, though ample spare capacity held by Saudi Arabia and other members of OPEC has limited price support, analysts say.
The oil market is also broadly underpinned by supply cuts from the OPEC+ group of producers. Iraq’s oil ministry said at the weekend that it will compensate for overproduction since the beginning of 2024.
“While fundamentals are still supportive, there are growing demand concerns, largely emanating from China,” said ING analysts led by Warren Patterson.