On Wednesday, oil prices slid down due to the resurfacing demand concerns and tensions between the US and China.
By 01.20 GMT, Brent crude futures slipped by 0.6% or 21 cents to USD35.96/barrel and US WTI edged down by 0.9% or 31 cents to USD34.04/barrel.
Demand concerns resurfaced as the recovery in the US is observed to be fragile even when many states have opened up. During the Memorial Day holiday, fuel demand just passed with demand equivalent to the start of the peak demand season as people only traveled close to home.
ANZ Research noted that its early estimates suggested that gasoline demand was just 70% of last year’s level
Eurasia Group opined that there is still a significant risk of repeat outbreaks and lockdowns weighing on people’s fuel needs. Combined with some restrictions in the aviation sector, demand could not seem to be as positive as normal yet.
Prices were also dragged down by the intensifying geopolitical tension between the US and China over the proposed national security legislation in Hong Kong.
However, the prices fall was still cushioned by the possibility of falling US crude inventories. A Reuters poll forecast the country’s crude stockpiles to have fallen for a third week in the week to May 22.
