Crude Range Trades As China Data Holds Good News

MNI (Australia) - Oil prices have been in a narrow range during APAC trading today after falling almost a percent on Monday. They rose following China’s rate cut announcement with the 1-year MTF reduced to 2.5% from 2.65% and while they are off their highs following that, they were not too adversely affected by the disappointing China data. The USD index is down slightly.

• Brent is up 0.1% to $86.30/bbl after a high of $86.46. It has found support at $86. WTI is flat at $82.54 with the high at $82.72.
• Bloomberg is reporting that China increased refining to its highest in 3 months in July and so apparent crude demand rose 21.2% y/y. OilChem expects refining operating rates to rise further in August. In July they were 81.2%.
• On the supply side, the US and UK warned about increased risks to shipping in the Strait of Hormuz near Iran, an important for crude shipping route. This is in addition to tensions in the Black Sea.
• Given the attention on supply, the US API inventory data out later is likely to be watched closely. It showed a 4.1mn barrel stock build in the latest week, according to Bloomberg.
• Later the Fed’s Kashkari speaks and US July retail sales are forecast to post solid monthly rises. There are also US trade prices for July, June inventories, August Empire manufacturing & NAHB housing. There is also Canadian July CPI and UK wages and labour data.