Oil prices are falling on Tuesday on signals that the stimulus measures in China are not enough to push the country’s economy and demand for oil to robust growth.
The day before, analysts at several investment banks, including Goldman Sachs Group Inc. worsened forecasts for the Chinese economy.
The People’s Bank of China (PBOC, the country’s central bank) on Tuesday lowered its benchmark one-year lending rate (LPR) by 10 basis points (bps) to 3.55% per year. The rate on five-year loans was lowered to 4.2 percent from 4.3 percent per annum, the NBK said in a statement. The rates were lowered for the first time since August 2022.
August Brent crude futures on London’s ICE Futures exchange were at $75.82 a barrel by 8:20 a.m. Tuesday, down $0.27 (0.35%) from the previous session’s closing price. Those contracts fell $0.52 (0.7%) to $76.09 a barrel on Monday.
The price of WTI crude futures for July at electronic trades of NYMEX fell by $0.9 (1.25%) to $70.88 per barrel by that time. The day before, WTI was not traded in the main due to a holiday in the U.S.
Oil prices may end in the negative for the second quarter in a row on the background of sufficient supply in the market and expectations of weakening demand in the context of tightening of monetary policy by the world’s major central banks.
