- Oil Prices Drop on Weak Chinese Data
Global oil prices declined slightly on Monday after data shows China’s economy is slowing down despite the improvement in trade talks.
Brent crude oil, against which Nigerian oil is measured, declined by 0.3 percent to $61.80 per barrel during the Asian trading session on Monday after gaining over 4 percent last week.
Oil prices fell after Chinese data showed profits of industrial companies declined for a second consecutive month in September, indicating the world’s second-largest economy and the largest importer of crude oil is struggling with growth. Therefore, the demand for crude oil is expected to slow down.
“There have been some small profit-taking sells on the weak China data released on Sunday and unwinding of weekend hedges,” said Stephen Innes, Asia Pacific market strategist at Axi Trader.
This was despite the two sides issuing a statement on Friday, saying they are reaching agreement on certain parts of the deal.
“But the market remains well supported on the dip,” Innes added, pointing to the statement that was released on Friday.
Also, because the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC oil producers continue to agree on production cut, they were able to support prices in spite of global uncertainty.