On Friday, oil prices fell on the back of the intensifying tensions between the US and China, and on Beijing’s failure to set economic target growth for this year. The oil market is worrying about the outlook of fuel demand in China.
Brent crude oil futures slipped by 4% or USD1.43 to USD34.63/barrel by 06.30 GMT. It touched the lowest at USD33.54/barrel today. WTI crude oil futures also slumped, by 5.3% or USD1.81 to USD32.11/barrel after crashing to USD30.72/barrel earlier.
The market is spooked over the tension between the US and China regarding trade and geopolitics as Beijing wants to impose a national security legislation plan in Hong Kong.
Beijing has also driven the market down by deciding not to set an economic growth target for 2020 in the meeting of the National People’s Congress (NPC).
Analyst Michael McCarthy of CMC Markets said that volumes were around double the average for the Asian session in the oil trading these past days, and it is not a surprise that people are taking off some risks from the table.
On the bright side, gasoline demand is seen to return to year-earlier levels as some of the world’s capital face traffic congestion after the coronavirus-related restrictions are eased. In the US, the upcoming Memorial Day holiday weekend would normally start the summer driving season.
The US crude inventories went down last week, contrasting with the expectations of a rise.
