Oil Prices Record First Weekly Gains Since Early August
Oil prices declined as production began to recover after Hurricane Francine, despite futures posting their first weekly gains in a month. Disruptions and risk appetite in broader markets helped ease the overselling that had gripped the crude market in previous days.
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Oil
West Texas Intermediate (WTI) crude fell 0.5%, settling below $69 per barrel, giving up earlier gains after Shell began restoring production in the Gulf of Mexico. The earlier recovery was largely driven by short-covering after the settlement price dropped below $66 on Tuesday, marking the lowest close since December 2021.
China
China’s economy faces additional risks as industrial production growth slows for the fourth consecutive month.
In August, China’s economic momentum weakened, with activity slowing across various sectors, signaling rising risks to achieving the government’s annual growth target.
The National Bureau of Statistics reported on Saturday that industrial production increased by 4.5% compared to the previous year, falling short of the 4.7% forecast. This marks the fourth consecutive month of slowing growth, the longest such period since September 2021.
Retail sales grew by 2.1%, slower than the previous month and below economists’ expectations of 2.5%. Both fixed asset and property investments also disappointed. The continued slowdown in industrial production shows that the most resilient part of China’s economy is losing steam, further darkening growth prospects as domestic demand struggles to recover and government investments have yet to bounce back.
Gas
European natural gas prices surged amid fierce competition from Egypt.
Natural gas prices in Europe jumped after results from an Egyptian tender revealed that global competition for the fuel remains strong, which could complicate the region’s ability to secure supplies. Benchmark futures rose 2.8% before paring some gains, offsetting the previous day’s losses. Prices climbed after Egypt’s state-owned General Petroleum Corporation purchased 20 shipments for fourth-quarter delivery at a premium over European prices. This move indicates that Europe will face stiff competition for supplies from countries like Egypt and others in Asia, just weeks ahead of the official start of the heating season. Prices have been volatile in recent weeks, and any signs of rising demand could disrupt the delicate balance of supplies in the region.
Oil Prices Record First Weekly Gains Since Early August