Crude Lower As China Demand Fears Resurface

Crude rallied in early APAC trading with WTI reaching a high of $73.36/bbl but has now pulled back to be down on the day driven by weaker equity sentiment across most of the region. China is weak on growth fears and US-China tensions particularly over chips. Fading optimism on a strong rebound in China’s oil demand has been a driver of lacklustre oil price trends. The USD index is up slightly.

• WTI is down 0.4% to around $72.40, just off the intraday low of $72.34. It is still higher than Monday’s low. Brent is down 0.6% to $76.64, also close to the low, and well off the intraday high of $77.59. Both have broken below even number support of $73 and $77 respectively.
• The market remains jittery over demand from China, US rates and supply ahead of the June 3-4 OPEC meeting. Also, the uncertainty is not over yet re the US debt deal, as it still has to pass through both houses of Congress.
• Later the European Commission May survey, March US house prices and May US consumer confidence & Dallas Fed manufacturing are released. Also, Fed’s Barkin speaks on monetary policy. US API inventory data prints too.