WTI Crude Oil Contract Closes in the Negative Amid China Real Estate Crisis

Editor’s Choice, economic news 6:47am.2024-01-30

The West Texas Intermediate (WTI) crude oil contract closed in the negative in New York on Monday (January 29), with the market weighed down by concerns that the crisis in China’s real estate market will weaken the economy and affect demand. for oil.

• The WTI crude oil contract is due in March. it fell $1.23 or 1.6% to close at $76.78/barrel.
• Regarding the Brent crude oil contract (BRENT), which was introduced in March. it fell $1.15, or 1.4%, to close at $82.40/barrel.

In the first session, WTI oil prices rose 1.5% amid speculation that tensions in the Middle East could spread more widely. after an Iranian-backed militia attacked a US military base in north-east Jordan near the border with Syria. As a result, three US soldiers were killed and 34 injured, and members of Congress called on President Joe Biden to order an attack on Iran in retaliation.

But oil prices weakened later. This is because investors are worried that the crisis in China’s real estate sector will affect economic activity and the demand for oil. After the Hong Kong High Court ordered the Chinese company Everlasting which is a Chinese real estate development company. Winding up businesses and selling assets to pay off debts of up to 2.39 trillion yuan (about 333 billion US dollars).

The real estate sector is considered an important pillar in the expansion of China’s economy. And accounting for nearly 30% of economic output, Evergrande’s bankruptcy could have a spillover effect on other companies in the real estate sector.

The market is keeping an eye on the US Federal Reserve’s (Fed) monetary policy meeting on January 30-31, while investors are placing almost 100% of their weight on expectations that the Fed will maintain interest rates in the this meeting.

Investors are also waiting to see the American Petroleum Institute (API) crude oil stocks release today before the US Energy Information Administration (EIA) releases official crude oil stock figures on Wednesday.

By InfoQuest News Agency (30 Jan ’24)

Tags: WTI , WTI oil , oil price

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