Oil Prices Remain Steady Amid China’s Growth Forecast
Oil Prices in Asian Trade
Oil prices saw minimal movement in Asian trade on Tuesday, with losses from the previous session being nursed. The lack of substantial support came as China, the top importer, revealed a moderate economic growth forecast for 2024.
Speculation and Concerns
Speculation regarding an Israel-Hamas ceasefire and concerns about declining demand continued to impact oil prices. These factors offset a positive supply outlook, despite production cuts by the Organization of Petroleum Exporting Countries and allies.
Stabilizing Prices
Oil prices, with contracts expiring in May, stabilized at $82.77 a barrel, while others fell slightly to $78.08 a barrel. The market seemed to have lost momentum following the extension of production cuts.
China’s Economic Outlook
China maintained a 5% GDP target for 2024, aligning with the previous year. The announcement, along with other economic reforms, was part of the 2024 National People’s Congress report. Despite efforts to boost growth, investor optimism regarding China’s economic recovery remained subdued.
Market Uncertainties
Weaker private data from China added to market concerns about oil demand in 2024. The uncertainty surrounding U.S. interest rates and expectations of hawkish signals from the Federal Reserve further contributed to market anxiety.
Middle East Tensions
Efforts for a ceasefire between Israel and Hamas gained traction, with President Joe Biden pushing for an agreement ahead of Ramadan. Geopolitical tensions in the region had previously supported oil prices, but a lasting ceasefire remained elusive.
The War’s Impact
The conflict had disrupted shipping activity in the Red Sea, highlighting the broader implications of the Israel-Hamas conflict. Despite some diplomatic efforts, a comprehensive resolution seemed distant, prolonging market uncertainties.
