Oil prices sank more than 4% on Tuesday, hitting their lowest levels in nearly two weeks, as weaker demand projections and reports easing supply concerns weighed on the market.
Both OPEC and the International Energy Agency (IEA) downgraded their global oil demand growth forecasts for 2024 this week, adding to bearish sentiment.
Brent crude futures fell by $3.21, or 4.14%, to $74.25 per barrel, while West Texas Intermediate (WTI) dropped $3.25, or 4.4%, to $70.58 per barrel. Both benchmarks touched their lowest levels since early October after sliding around 2% on Monday.
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SS, nearly erasing the gains made amid concerns that Israel might target Iran’s oil infrastructure following the October 1 missile attack. However, investor fears subsided after reports that Israel would refrain from striking Iranian oil assets. According to the Washington Post, Israeli Prime Minister Benjamin Netanyahu informed the US that Israel would focus on non-nuclear military targets rather than oil facilities.
Adding to the market’s bearish outlook, China’s September oil imports fell year-over-year, according to customs data, reflecting weaker demand from the world’s largest crude importer. Additionally, a survey indicated that China’s economic growth is unlikely to meet Beijing’s target for 2024, further dampening demand prospects.
The combination of demand downgrades from OPEC and the IEA, together with slower-than-expected economic growth in China, has raised concerns that global consumption may remain subdued in the coming months.
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