(London) Oil prices were down slightly on Tuesday after their strong rebound the day before, torn between fears of recession, falling demand in China, and still constrained supply.
Posted at 6:36 a.m.
Around 5:05 a.m., a barrel of Brent from the North Sea, for delivery in September, lost 0.70% to 105.53 dollars.
A barrel of American West Texas Intermediate (WTI), for delivery in August, fell 0.53% to 102.06 dollars.
Crude prices showed some signs of weakness on Tuesday, “due to signs of swelling US oil inventories,” said Stephen Brennock, analyst at PVM Energy.
In addition, “high inflation and interest rate hikes have increased the likelihood of a global recession”, weighing on oil prices by threatening demand, he continues.
“But the oil markets could soon find themselves facing another major wall of concern: the slowdown in the Chinese economy,” said the analyst.
China recorded its highest number of COVID-19 cases since May on Saturday, with millions of people across the country spending the weekend in lockdown under a strict “zero COVID-19” policy.
In Macau, authorities have extended health restrictions by five days.
Repeated confinements have weighed on the country’s economy. China saw its economic growth collapse in the second quarter, to only +0.4%, according to official figures published on Friday.
“The recent setbacks of COVID-19 and the lull in economic activity in China have dampened demand for oil,” said Stephen Brennock.
Crude was also recovering from a choppy session the previous day, with supply tensions returning to the fore following US President Joe Biden’s trip to Saudi Arabia as the country indicated it would not unilaterally raise. its output.
“The weaker dollar has provided additional price support,” making crude more attractive to investors using other currencies, Brennock said.