(New York) Oil prices widened their losses on Tuesday, pulled down by an indicator on Chinese exports which does not encourage investors to be optimistic about the growth of the country, the largest importer of crude in the world.
A barrel of Brent from the North Sea for delivery in January lost 4.19% to $81.61, its lowest since the end of July.
Its American equivalent, a barrel of West Texas Intermediate (WTI) for delivery in December, fell by 4.26% to $77.37, its first plunge below the $80 threshold also since the end of July.
Crude prices are “at their lowest level in three months and well below their October 6 price”, before the bloody Hamas attack on Israeli territory, noted Andy Lipow of Lipow Oil Associates.
In China, the fall in exports accelerated in October, with a decline of 6.4% over one year, according to data published by the country’s customs on Tuesday, a figure which does not encourage optimism for its economic growth.
“Chinese exports […] are a good indicator of global economic health,” explains Swissquote analyst Ipek Ozkardeskaya. These gloomy economic data worry the market about demand from China, the world’s largest oil importer.
“The data on Chinese imports of crude oil in October, published overnight by the customs authorities”, which recorded a slight increase, “did not prevent the fall in prices”, adds Carsten Fritsch, analyst at Commerzbank.
These data also remain disappointing, as crude imports are compared to a lower base last year due to health restrictions to combat COVID-19 in the country.
“The data from China caused a bout of selling,” commented Andy Lipow, noting that demand for crude oil from Chinese refineries would also be reduced in November and December.
At the same time, on the supply side, crude oil exports from Russia continue to go well, according to tanker tracking data, Andy Lipow said.
“Overall we see that concerns about demand go beyond the fear of a potential disruption in oil supplies due to the situation in the Middle East,” Mr. Lipow further underlined.