Ammon – Oil prices rose in Asian trading on Wednesday, as markets assessed signs of weak demand in China and the possibility of raising US interest rates again in exchange for a possible shortage in supplies.
And by 03:05 GMT, Brent crude rose 13 cents, or 0.2%, to $ 84.16 a barrel. US West Texas Intermediate crude rose 18 cents, or 0.2%, to $79.82.
And the two benchmarks lost about 0.5% on Tuesday.
Markets await hints about the path of interest rates when Federal Reserve officials and policy makers from the European Central Bank, Bank of England and Bank of Japan head to Jackson Hole, Wyoming, for their annual meeting this week.
“Concerns about rising interest rates and slowing demand in China are expected to outweigh the supply cuts from OPEC+ in the short term,” said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities.
Demand in China, the world’s largest oil importer, is crucial to supporting oil demand through the rest of the year. Its weak growth has disappointed markets with stimulus from the state falling short of expectations.
On the supply side, Saudi Arabia volunteered to cut production by another 1 million barrels per day from July to the end of September, and Russia plans to cut exports in August by 500,000 barrels per day.
The moves are part of an agreement between members of the OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, to curb supply and support prices.
In the United States, crude stocks continued to decline, as market sources said, quoting data from the American Petroleum Institute on Tuesday, that they fell by about 2.4 million barrels in the week ending August 18. That was just short of a drop of 2.9 million barrels expected by analysts in a poll.
The EIA’s weekly report, the statistical arm of the US Department of Energy, is due out at 14:30 GMT Wednesday.