Oil prices drop as China economy pulls markets

SINGAPORE: Oil prices fell on Tuesday on signs that an economic slowdown in China, the world’s second-largest economy and oil consumer, was spreading, stoking concerns over future fuel demand.
The gloomy economic news has pulled down financial markets across Asia, including crude oil futures.
International Brent oil futures were at $62.26 per barrel at 0736 GMT, down 48 cents, or 0.8 per cent, from their previous close.
US West Texas Intermediate (WTI) crude futures were at $53.43 per barrel, down 0.7 per cent, or 37 cents.
China’s state planner on Tuesday warned that the downward pressure on the economy will affect China’s job market as falling factory orders point to a further drop in activity in coming months and more job shedding.
On Monday, China reported its lowest annual economic growth since 1990.
China’s oil imports have so far defied the economic slowdown, hitting a record above 10 million barrels per day (bpd) in late 2018, but many analysts believe the country to be at peak energy growth, with its thirst set to wane as the slowdown bites.
“Slowing manufacturing activity in China is likely weighing on demand,” said Singapore-based tanker brokerage Eastport, adding that industrial slowdowns tended to be leading indicators that fed gradually into lower demand for shipped oil products. — Reuters