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West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $68.00 on Wednesday. The WTI price edges lower after the Organization of the Petroleum Exporting Countries (OPEC) cut its forecast for global oil demand growth in 2024.
OPEC’s latest downward revision for demand growth exerts some selling pressure on the black gold. OPEC stated in a monthly report on Tuesday that world oil demand will rise by 1.82 million barrels per day (bps) in 2024, down from growth of 1.93 million bpd it expected last month. OPEC also lowered its 2025 global demand growth estimate to 1.54 million bpd from 1.64 million bpd, marking the producer group’s fourth consecutive downward revision.
Disappointment over China’s latest stimulus plan undermines the WTI price as China is the world’s second-biggest oil consumer. Last week, China announced a stimulus plan of 10 trillion yuan, but analysts worry that it would not be enough to stimulate the economy. This, in turn, has raised fears about China’s likely decline in oil consumption.
The stronger US Dollar (USD) contributes to the WTI’s downside as it makes USD-denominated Oil prices more expensive. Meanwhile, the US Dollar Index (DXY), a measure of the USD’s value relative to a basket of foreign currencies, climbs to fresh six-month peaks past the 106.00 barrier. Investors will keep an eye on the US October Consumer Price Index (CPI) inflation data on Wednesday for fresh impetus. In case of the surprise softer-than-expected outcome, this could weigh on the Greenback and help limit the WTI’s losses. More By This Author:GBP/USD Extends The Decline Below 1.2850 Ahead Of UK Employment DataWTI Retreats To Near $68.00 On Chinese Stimulus Disappointment, Stronger US Dollar USD/CHF Edges Higher Above 0.8700 Amid Renewed US Dollar Demand
