Oil prices fell about 2 percent on Monday, November 11, after China’s stimulus plan disappointed investors. Reuters reported.
The report added that Brent crude futures fell 2.48 percent or $1.83 to $72.04 per barrel at 2:44 PM (GMT), and U.S. West Texas Intermediate crude futures fell by 2.71 percent or $1.91 to $68.47 per barrel.
The benchmark indices also fell by more than 2 percent on Friday. The US dollar index rose slightly above its highs following the US presidential election on November 5. The index measures the US dollar against a basket of foreign currencies. Dollar-denominated commodities such as oil have become expensive due to a stronger US currency.
Consumer prices in China have risen slowly over the past four months in October, and producer price deflation has increased despite the country’s efforts to double down on stimulus measures.
“China’s inflation data was again weak, with the market fearing deflation, especially as the annual change in the producer price index moved further into negative territory… China’s economic momentum remains negative,” the report said, quoting Achilleas Georgolopoulos, a market analyst. at real estate agency XM.
The report, citing Tamas Varga, an analyst at oil broker PVM, said China’s recent stimulus package will not revive oil demand or crude imports.
“Following last week’s US presidential election, attention is slowly drifting back to the underlying fundamentals,” Varga added.
Oil prices also fell as concerns about possible supply disruptions from Storm Rafael in the US Gulf-Mexico region eased.
The report, citing the offshore energy regulator, said more than a quarter of U.S. Gulf of Mexico oil and 16 percent of natural gas were unavailable Sunday.
Concerns about the increase in US oil and gas production
Meanwhile, there are concerns about the increase in US oil and gas production under the Donald Trump administration; However, the oil production forecast is not likely to change in 2025. Trump had promised to raise import tariffs to boost the US economy.
The report said there are also concerns about tougher sanctions on OPEC countries such as Iran and Venezuela and the reduction of oil supplies to global markets. This is partly responsible for an increase in the oil price of more than 1 percent last week.
