Price Performance Indicators

• Week (06/11 - 10/11) ICDX oil prices decreased 6.49%.  
• China's economic data and the release of crude oil stocks

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Market Review

ICDX oil prices weakened to $75.59 per barrel at the end week of November 10 due to the release of news related to Chinese economic data and an increase in oil stocks.

At the beginning of this week, monitoring the health of the Chinese economy, which was the main focus with import and export data, exports fell by 6.4% and imports rose by 3% year on year, which is expected to provide an idea of which direction the economy will move. Chinese economic data showing strong growth in oil imports, but in contrast to total exports of goods and services, reflects the continued decline of the Chinese economy. Besides that,

data from China's trade balance which increased by 56.53B is likely to bring hope for increasing oil demand.

The downward trend in world oil prices was triggered by the economic slowdown in major oil consuming countries, such as the United States. Factors procuring crude oil supplies in the United States and indications of further monetary tightening by Federal Reserve Chairman Powell (8/11) put additional pressure on the energy sector. Jerome Powell said that commitment was still needed to implement a fairly tight monetary policy to reduce inflation to reach 2% as time goes by.

Saudi Arabia and Russia responded to market conditions by announcing voluntary cuts in oil production, seeking to address falling prices and maintain market stability. These cuts could be extended into the first quarter of 2024, prompted by concerns about weakening economic growth, and OPEC's aim to support market stability.

Market View

API Oil Stock Data and Oil Market Conditions

API released (15/11) oil stock data released by API in November showing an increase of 1,335M. Meanwhile, the Energy Information Administration (EIA) estimates an increase in oil demand until 2024. OPEC is actively trying to maintain oil market stability, stating that overall oil supply is still limited, although it has been hit by negative sentiment several times.

OPEC Meeting and Production Cuts Influence Oil Market Factors

Future market focus is waiting for the OPEC meeting on November 26 to discuss reducing oil production, in the hope of controlling price declines, and Saudi Arabia is believed to be the first country to reduce production until the first quarter of 2024. Then the market is still digesting China's economic slowdown which indicates the potential for deflation and its impact on weakening oil demand. Meanwhile, consumers in the United States are showing increased inflation expectations, which could influence the Federal Reserve's monetary policy.

WEEKLY ECONOMIC DATA & EVENTS CALENDAR

Source: ICDX Research