China’s GDP rose 6.3% YoY in Q2, compared with expert projections for a hike of 7.3%, with a weak recovery after the Coronavirus.
BNR – Oil price remained falling into the 2nd session on Monday following China’s weaker Q2 development. The steady decline has raised worries regarding demand in the globe’s second-largest oil customer. It is worth noting that Libya resumed oil production this weekend.
Brent crude dropped $0.91, accounting for 1.1 per cent, to $78.96 per barrel. On the other hand, the US West Texas Intermediate crude dropped $0.87, also accounting for 1.1 per cent, to $74.55 per barrel.
The gross domestic product (GDP) of China rose 6.3 per cent yearly in Q2, according to the National Bureau of Statistics. This falls into comparison with expert projections for a hike of 7.3 per cent, with a weak recovery after Coronavirus.
“The GDP came in below expectations,” Warren Patterson, ING’s head of commodities research said. “So, will do little to ease concerns over the Chinese economy.”
Chinese Refineries Boost Oil Demand Despite GDP Concerns
Chinese plants refined 1.6 per cent more oil per day in June than they did in May. The plants accelerated work following the spring maintenance, conforming with high importation by the globe’s No.1 oil consumer in June.
“Apparent oil demand grew at a strong pace… but the market seems focused on the headline (GDP) numbers,” Patterson stated.
China may be careful in synchronising any fresh encouragement action, so as to not raise the price of commodities.
“They are stockpiling crude at low prices, and waiting for recession to hit the West before going full-on with stimulus,” stated Stefano Grasso, a senior portfolio manager at 8VantEdge in Singapore.
Prices became softer after the two benchmarks recorded a 3rd week of revenue and set their record high since April. This is following the shutting of the output of the oil fields in Libya and Shell halting the exportation of Nigerian oil.
Libyan Oil Production Resumes
Two of the three Libyan oil fields that were closed last week, the Sharara and El Feel. Both fields had an overall output rate of 370,000 barrels per day (bpd). However, the oil fields resumed operations on Saturday evening, according to the oil ministry.
The third field stayed closed in protest against the kidnapping of the former finance minister.
