Chinese Data Gives Brent A Boost
Brent crude oil saw a lift on Wednesday after data from China indicated that global demand could be on the upswing. The commodity traded at $106.42 at 9:10 GMT following better than expected Chinese GDP data, which offset downward pressure from easing supply concerns.
The Wall Street Journal reported that Chinese GDP data showed that the nation’s economy expanded 7.5 percent in the second quarter. The figure beat expectations of 7.4 percent growth and indicated that Beijing’s stimulus efforts were paying off.
The GDP data wasn't the only demand-side source of price pressure. The good number came just a day after money supply data showed that the People’s Bank of China had injected more money into the markets, which is expected to bolster growth in the country throughout the rest of the year. Also positive was a report showing Chinese implied oil demand on the rise, gaining 2.6 percent in June from last year.
Related Link: Brent Steady With Supply Worries In Focus
Moving forward investors will be keeping an eye on geopolitical factors. Conflicts in Iraq, Libya and Ukraine remain worrisome, and talks between world powers and Iran show no signs of the two reaching an agreement.
World powers and Iranian officials have been working to come to a long-term agreement that will curb Tehran’s nuclear capabilities in exchange for relief from the sanctions that keep the nation’s oil from the markets. Earlier in the year, both sides set a July 20 deadline, but now it appears unlikely that they will reach agreement on time. Most expect that the deadline will be extended as negotiations continue.
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