Oil prices fell on Monday over weakening demand signs in the world’s second-largest oil consumer, China, while Saudi oil company Aramco said it may increase production due to higher demand expectations.
International benchmark Brent crude traded at $97.14 per barrel at 09.58 a.m. local time (0658 GMT) for a 1.02% decrease from the closing price of $98.15 a barrel in the previous trading session.
American benchmark West Texas Intermediate (WTI) was at $91.19 per barrel at the same time for a 0.97% drop after the previous session closed at $92.09 a barrel.
Data from the National Bureau of Statistics (NBS) showed that daily crude oil throughput in July of the world’s second-largest economy, China, decreased to its lowest level since March 2020.
Signaling weaker demand, China’s crude throughput decreased by 8.8% to 53.21 million tonnes, or 12.53 million barrels per day relative to the same month in 2021.
China also saw slower-than-expected industrial production and retail sales growth, suggesting the zero-COVID policy is weakening consumer demand.
China’s industrial production showed year-on-year growth of 3.8% in July, weaker than the market estimate of 4.6%, according to the National Bureau of Statistics.
However, Saudi state oil company Aramco said Sunday it expects oil demand to continue to grow for the rest of the decade, despite downward economic pressures on short-term global forecasts.
The company CEO Amin Nasser said Aramco may ramp up production to 12 million barrels per day (bpd) any time if “there is a need or a call from the government or from the ministry of energy to increase our production.”
Following reports of Iran potentially agreeing a nuclear agreement mediated by Europe on the provision of relevant guarantees, supply concerns eased.
