Oil prices declined on Monday, November 11, as the threat of supply disruptions due to a storm in the US diminished, as well as investor disappointment with China’s economic stimulus plan, Reuters reports .
Prices for Brent crude oil fell 31 cents, or 0.4%, to $73.56 per barrel, while West Texas Intermediate futures in the US fell 38 cents, or 0.5%, to $70 per barrel. Last Friday, both indicators fell by more than 2%.
The drop in oil prices came after fears of supply disruption from Hurricane Rafael in the US Gulf of Mexico were significantly reduced. According to the offshore energy regulator, as of Sunday, more than a quarter of Gulf of Mexico oil and 16% of natural gas production remained offline. Chevron said it would start redeploying staff to its platforms to resume operations.
The market was also disappointed with the new stimulus measures announced on Friday. The plan did not meet market expectations, as Chinese politicians did not provide for significant fiscal stimulus. China’s oil consumption is expected to remain flat in 2024 due to slower economic growth and increased use of electric vehicles, which has reduced demand for petrol.
Uncertainty over the policies of the new US President Donald Trump also had a negative impact on the global economic outlook, although his likely sanctions against OPEC, Iran and Venezuela could limit oil supplies to global markets and cause price fluctuations.
