WTI impacted by China’s exports concerns

WTI crude oil has seen a significant drop, trading around $78.35, close to its lowest in over two months. Disappointing export figures from China raise alarms about potential declines in oil demand, pressuring prices. OPEC+ production cuts, led by Saudi Arabia and Russia, provide some support but fail to offset demand-side fears.

China-based refiners cut their production between November and December, which could weigh on crude oil demand, exacerbating price declines.

The US Crude Oil benchmark WTI dropped more than 2.80% on Tuesday, despite Saudi Arabia and Russia underpin the oil market due to their crude output cuts. The recovery of the Greenback (USD) has influenced oil prices, with the US Dollar Index climbing 0.34% against a basket of six currencies. Saudi Arabia and Russia’s 1.3 million-barrel cut is capping WTI losses, as they have extended their plan toward the end of 2023, with estimates they could extend it through the first quarter of 2024.