West Texas Intermediate (WTI) Oil price edges higher following a more than 7% decline registered in the previous week, trading around $68.90 per barrel during the Asian hours on Monday. However, the downside may be limited as rate cuts in China, the largest Oil importer, are expected to stimulate domestic economic activity, potentially increasing demand for Oil. The People’s Bank of China (PBoC) lowered the 1-year Loan Prime Rate (LPR) to 3.10% from 3.35% and the 5-year LPR to 3.6% from 3.85%, aligning with expectations.
- WTI could receive support as PBoC rate cuts could stimulate China’s economic activity, potentially increasing Oil demand.
- US President Joe Biden stated that there is an opportunity to end the conflict between Israel and Iran for a while.
- Shell and Singapore’s Maritime and Port Authority have implemented clean-up measures in response to a leak from a land-based pipeline.
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However, crude Oil prices received downward pressure, partly due to slowing economic growth in China. On Friday, China’s Gross Domestic Product (GDP) grew at an annual rate of 4.6% in the third quarter of 2024, slightly down from the 4.7% growth recorded in the second quarter but surpassing market expectations of 4.5%.
Additionally, easing geopolitical tensions in the Middle East have lessened concerns over supply disruptions from the region. US President Joe Biden stated on Friday that there is an opportunity to “deal with Israel and Iran in a way that ends the conflict for a while.” However, on Sunday, Israel announced that it was preparing to target sites in Beirut linked to Hezbollah’s financial operations, according to Reuters.
In another development, Reuters reported that Shell and Singapore’s Maritime and Port Authority implemented clean-up measures following a leak from a land-based pipeline. The leak has reportedly been contained at the source, with no impact on navigation safety. A Shell spokesperson confirmed the leak at the Shell Energy and Chemicals Park, stating that emergency response specialists had been dispatched to manage the situation.
