Oil prices firm despite concerns about Chinese economy

Oil prices were little changed today, Tuesday, as investors continued to focus on the possibility of slowing Chinese growth reducing demand from the world’s largest importer of crude oil.

By 1300 GMT, Brent crude fell 26 cents to $84.20 a barrel, and US West Texas Intermediate crude fell 24 cents to $79.88 a barrel.

According to “Reuters”, West Texas Intermediate crude contracts for the nearest maturity month fell 10 cents to $80.62 a barrel, due to weak trading before its imminent expiry.

China, the second largest economy in the world, is a necessary factor to boost the volume of oil demand during the rest of the year. But its weak economic activity frustrated markets after promised stimulus measures disappointed, including a smaller-than-expected cut to a key lending benchmark on Monday.

Federal Reserve officials (the US central bank) did not rule out raising interest rates again in their battle to contain inflation, which fueled concerns about demand.

The United States is expected to continue drawing down its oil stocks. A preliminary Reuters poll showed that crude oil and gasoline stocks fell in the United States last week, and data from the American Petroleum Institute is scheduled to be released later on Tuesday.

But efforts are likely to be made to overcome global supply scarcity. And the Iraqi News Agency reported today, Tuesday, that the Iraqi and Turkish oil ministers discussed the importance of resuming oil exports after the completion of pipeline maintenance.

Turkey stopped Iraq’s exports of 450,000 barrels per day, equivalent to approximately 0.5% of global supplies, via a pipeline extending from northern Iraq to Turkey on March 25, following a ruling in an arbitration case issued by the International Chamber of Commerce.