Wednesday , August 10 2022

Lubricate the oil while waiting for the Fed and China-US negotiations


New York (AWP / AFP) – Oil prices rose on Monday as investors are preparing for the upcoming fall in US Federal Reserve (Fed) interest rates as well as the US-Chinese negotiators who met this week,

In London, the North Sea crude Brent crude for delivery in September rose 0.4 percent or 25 cents to $ 63.71.

In New York, US WTI's barrel for delivery at the same time was $ 56.87, an increase of 1.2% or 67 cents on Friday's closing.

According to Phil Flynn of the Price Futures Group, "the market is optimistic that the fall in Fed interest rates this week will increase oil prices."

Reducing key rates is expected to boost economic activity and increase the consumption of hydrocarbons, increasing raw material prices.

WTI's price also rose around 13:30 GMT (15:30 in Paris) after US President Tweed Trump's tweak accused the FRS of acting too late and too little in terms of interest rates compared to the European Union and China.

Moreover, the meeting of the main trade negotiators of Washington and Beijing on Tuesday and Wednesday in Shanghai, in a full Sino-American trade war, is eagerly awaited by investors.

"Every hope that the US and China will make a trade deal, or at least move in the right direction, push oil prices," Flynn said.

The summit in Shanghai will be the first trade-in-face between the US and China following the collapse of talks in May when Donald Trump accused Beijing of failing to meet its commitments.

Then the US president decided to significantly increase the customs fees for most of the Chinese products.

Data on Chinese imports of black gold, published on Sunday by the Chief Customs Administration, also showed that they remained strong in June, despite sanctions against Iranian oil.

"The chorus that the Chinese economy is slowing down and the notion that China does not consume so much oil is still not reflected in the numbers," Flynn said.

-dho / jum / juf

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