Trade tensions keep a lid on oil prices
Continued trade tensions in the US and China continue to offset Chinese economic growth. China's National Bureau of Statistics (NBS) said Thursday that the country's economy was delaying in the first two months of the year when industrial production fell to its lowest in decades. Growth in industrial production declined to 5.3 per cent in January and February compared to the same period last year, down from 5.7 per cent growth in December. Growth in January and February was the lowest since March 2009, with 5.1 per cent.
Unemployment in China also increased during the first two months of the year, rising to 5.3 percent in January and February, compared with 4.9 percent in December. It is the highest unemployment mark for January to February period since 201[ads1]7. Julian Evans-Pritchard, senior Chinese economics economist, said "recent activity and spending data indicate that economic conditions remain weak at the beginning of 2019. The first two months of the year to eradicate seasonal volatility caused by annual shifts in the Chinese New Year's schedule. "
Furthermore, China's overall growth rate went to 6.6 percent last year, the slowest growth rate of 28 years, mainly attributable to trade tensions between Washington and China. To help boost the economy, Beijing is endeavoring a number of measures, including by launching a series of tax policy measures, including tax deductions and additional funds for municipal infrastructure spending. Chinese Prime Minister Li Keqiang said on Friday that China could use reserve requirements and interest rates to support economic growth when he promised broad political steps to prevent a sharper depreciation as the country's economic expansion slows.
Tensions of dreams ]
Thursday, US Finance Minister Steven Mnuchin said a summit to seal a trade agreement between President Trump and Chinese President Xi Jinping would not happen at the end of March as previously discussed because it is needs more work in negotiations between the US and China. Mnuchin, who spoke to journalists following a statement by the US Senate Finance Committee, said that both sides were "in good faith" to try to get a deal "as soon as possible." He added that "there is still a lot of work to do, but we are very comfortable with where we are. I do not think that is significantly different from the currency problem from where we were last."
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There are also ongoing trade tensions and concerns over economic growth, which have already hit Asia and much of Europe, with North America likely to follow, keeping global oil prices from breaking new ground and trends upwards more than they already have. 19659002] Recently, global oil prices appear to be trapped in a war between supply factors, including successful OPEC + efforts to dominate oil production after their agreement reached last year for a 1.2 million bpd cut. Production shortage from both Iran and Venezuela, as US sanctions eat in both countries' oil production, and a strong US oil production, which recently bypasses 11.2 million bpd, is also on its way.
However, the slower economic growth in China has not yet eaten into its oil demand growth and oil imports. Demand for crude oil in China, the world's largest crude oil importer, increased in the first two months of 2019 by 6.1 percent from the previous year to a record $ 12.68 million, official data showed this week. Similarly, on Friday, global oil prices achieved their highest price points so far this year among OPEC + cuts, and setbacks in Iranian and Venezuelan production provide a weak supply deficit in global oil supplies for the first quarter, Refinitive data showed.
US -Oil benchmark West Texas Intermediate (WTI) raw futures were up 15 cents at $ 58.76 / barrel at 0745 GMT on Friday, their strongest mark so far in 2019. London-traded, global benchmark Brent crude futures were At $ 67.43 a barrel, up 20 cents, or 0.3 percent, from their last settlement – within a dollar of the 2019's of $ 68.14 2019 reached the previous day. Oil prices are up in the quarter at the beginning of the year.
By Tim Daiss for Oilprice.com
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