WTI PLUNGES TO NEAR $67.50 AS CRUDE OIL'S MIDDLE EAST RISK PREMIUM FADES
- WTI price edges lower to near $67.55 in Thursday’s Asian session.
- Easing fear of crude supply and China’s demand woes could weigh on the WTI price.
- Investors will monitor the US advanced Q3 GDP on Wednesday ahead of the employment data.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $67.55 on Tuesday. The WTI price plunges as the limited military operation eased concerns about a potential all-out war in the Middle East.
On Saturday, Israel targeted Iran's military installations in three provinces in reaction to Tehran launching ballistic missiles at Israel on October 1. However, Israel did not strike Iran's oil or nuclear facilities in retaliation for Iran's ballistic missile attack, and Iran's official media claimed that oil output was normal. This, in turn, undermines the WTI price as a fear of significant disruption in the crude supply fades.
Furthermore, weak demand outlooks and China's economic slowdown contribute to the WTI’s downside. Data released by China's National Bureau of Statistics on the weekend showed the country's industrial profits fell by 27.1% YoY in September, the steepest decline since the pandemic.
A report from the International Energy Agency (IEA) indicated that oil demand is estimated to grow at only half the pace in 2024 and 2025 compared to 2022 and 2023, primarily due to a decline in Chinese demand.
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