Crude oil prices fell 2% Tuesday as President Trump fanned market fears China-U.S. trade tensions are far from settled amid ongoing negotiations, a negative sign for oil demand growth.
Trump Tuesday sharply criticized what he called China’s unfair trade practices in a speech at the United Nations General Assembly in New York City, saying he would not accept a “bad deal” between the U.S. and China, Kallanish Energy reports.
Brent crude futures fell $1.35, or 2%, to $63.42 a barrel. U.S. West Texas Intermediate futures were down $1.12, or 1.9%, to $57.52/Bbl.
“Not only has China declined to adopt promised reforms, it has embraced an economic model dependent on massive market barriers, heavy state subsidies, currency manipulation, product dumping technology transfers and the theft of intellectual property and also trade secrets on a grand scale,” Trump told his General Assembly audience.
U.S. stocks also fell, reversing earlier gains following Trump’s comments and a private sector report showing U.S. consumer confidence fell the most in nine months in September.
Sluggish economic data in leading European economies and Japan also weighed on crude prices, analysts told Reuters.
Oil prices have remained at comparatively elevated levels for the year in the wake of the Sept. 14 attack on Saudi Arabia’s largest oil-processing facility, which halved output in the world’s top oil exporter.
Reuters reported Monday Saudi Arabia had restored more than 75% of crude output lost after attacks on its oil installations and would return to full volumes by early next week.
But The Wall Street Journal said repairs at the plants could take months longer than anticipated. State-run oil company Aramco has stepped up purchases of products such as naphtha, gasoline and diesel from Europe and elsewhere.
Aramco is also buying oil originating in neighboring countries to meet its supply obligations to foreign refineries, sources familiar with the matter told Reuters.
Its trading arm is arranging for crude from the United Arab Emirates and Kuwait to cover its commitments to certain buyers, the sources said.
This post appeared first on Kallanish Energy News.