Chinese Slowdown Weighs on Brent
Brent crude oil continued to tumble on Wednesday morning as investors turned their attention to China, the world's second largest oil consumer, where a recovery was looking less and less likely. Worries about China weighed on Brent prices and the commodity traded at $107.72 at 5:00 GMT on Wednesday morning.
CNBC reported that Chinese data showed that the nation's June oil imports had fallen 7.4 percent from May's figure. China's trade data also followed a downward trend, which many took as another sign of an economic slowdown.
Also weighing on Brent prices was the International Monetary Fund's reduced global growth forecast which was released on Tuesday. This lower, revised forecast marks the fifth reduced forecast that the fund has put out this year. The IMF cited the eurozone recession and a slowdown in emerging economies as the main drivers for the reduction.
Brent found some support from geopolitical tension as investors watched for any new developments in Egypt, where Islamist President Mohamed Morsi was ousted. Tensions in the African nation are running high as supporters and opponents of Morsi rally in the streets. Although the tension seems to be dissipating, riots that broke out last week have left at least 90 people confirmed dead.
Egyptian authorities, who have been selected to provide an interim government, have begun to form a cabinet and organize elections to name a new leader. Backed by $8 billion in Gulf Aid, many are hoping that the efficient and timely election of a new leader will keep the country from slipping into a bloody civil war.
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