LONDON, Dec 7 (Reuters) – Oil prices recovered some ground on Thursday after hitting a six-month low, but investors worried about sluggish demand in the United States and China.
Brent crude futures were up 76 cents, or 1%, at $75.06 a barrel by 0924 GMT. U.S. West Texas Intermediate crude futures were up 67 cents, or 1%, at $70.05 a barrel.
„Prices are under pressure as the world’s largest oil importer (China) quenches its thirst for crude, while the largest producer, the US, continues to post headline output,” said PVM Oil analyst John Evans.
In the previous session, the market was spooked by data showing US manufacturing near a record high, even as inventories fell, analysts at ANZ said in a note.
U.S. gasoline stocks (USOILG=ECI) rose 5.4 million barrels last week to 223.6 million barrels, Energy Information Administration data showed Wednesday, beating expectations for a 1 million barrel build.
Concerns about China’s economy are also keeping a lid on oil price gains. Chinese customs data showed crude oil imports fell 9% in November from a year earlier due to higher inventory levels, weaker economic indicators and lower orders from independent refiners.
Although China’s total imports fell on a monthly basis, exports grew for the first time in six months in November, suggesting the manufacturing sector may be starting to benefit from an increase in global trade flows.
Ratings agency Moody’s issued a downgrade warning on Hong Kong, Macau and China’s state-owned enterprises and banks on Wednesday, a day after it issued a downgrade warning on China’s sovereign debt rating.
Oil prices have fallen about 10% since the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, announced voluntary production cuts of 2.2 million barrels per day in the first quarter of next year.
Meanwhile, Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman met on Wednesday as members of OPEC+ to discuss further oil price cooperation, which could bolster market confidence on the impact of production cuts.
OPEC+ member Algeria said on Wednesday it would not extend or deepen oil supply cuts, as oil prices fell to a fresh five-month low after OPEC+ announced the cuts last week.
Russian Deputy Prime Minister Alexander Novak said on Tuesday that the group was ready to reinforce oil production cuts in the first quarter of 2024, dispelling speculation and volatility.
Russia has promised to release more data on its fuel refining and export volumes after OPEC+ asked Moscow for more transparency on its exports of classified fuel from several export points across the country, OPEC+ and shipping watchdogs told Reuters.
Additional reporting by Colin Howe and editing by Muyu Xu by Mark Potter
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