Oil prices decline, Brent sheds 4.5% on Chinese demand concerns
Oil prices fell in European trade, resuming the losses after a short hiatus on Friday, with US crude down 3%, while Brent shed over 4.5% on renewed concerns about demand in China, the world's largest oil importer.
Prices were pressured by dollar's gains against a basket of major rivals, which led investors await from high risk assets for the time being.
Global Prices
US crude fell 3% to $82.66 a barrel, while Brent declined over 4.5% to $89.07 a barrel.
US crude rose 0.2% on Friday while Brent added 0.9%, with the dollar hurt by bearish remarks by a Fed official.
Chinese Demand
Customs data showed China's crude oil imports were at 9.79 million bpd in September, down 2% from the previous year.
China continues to impose Covid 19 restrictions on the populations, which hamper trade and economic growth considerably and hurts fuel demand.
Global Recession
Earlier European and UK data today on manufacturing and services bolstered indications of a recession in the fourth quarter, in turn hurting fuel demand as well.
The Dollar
The dollar index rose 0.6% today away from three-week lows at 111.47 against a basket of major rivals.
Dollar remains a favorite among investors as the Federal Reserve remains set on increasing interest rates aggressively to control runaway inflation.
Dollar regains ground ahead of US major data
Dollar rose in European trade away from three-week lows against a basket of major rivals, as investors assess latest bearish statements by Fed officials.
Such improvements came ahead of important US data for October, which will offer clues on the health of the world's largest economy in the fourth quarter.
The Index
The dollar index rose 0.6% to 112.53, with the lowest since October 6 at 111.47.
The index lost 0.85% on Friday as risk appetite improved in the markets after Bank of Japan's intervention to boost yen.
Several Fed officials warned last week from causing recession inadvertently by extreme rate hikes, and expressed the need to start talking about easing up the process.
Major Sectors
Investors await a batch of important US data later today, including the manufacturing PMI, expected at 51.0, down from 52.0 in September, while the services PMI is expected up slightly to 49.6 from 49.3.
Such data will help decide the policy path of the Federal Reserve in the next few months.
