Oil prices tumble as weak global economic data raise demand concerns
A report released this week from the U.S. showed retail sales stalled in April, thereby raising concerns the weak growth pace would extend to the second quarter.
People’s Bank of China (PBOC) slashed its key interest rate for a third time in six months this week to bolster economic growth.
“China’s economy is still facing relatively big downward pressure,” PBOC said on Sunday.
On the other hand, Saudi Arabia, the world’s largest oil exporter, continued to boost its oil production to take away market share from U.S. producers.
In April, the Kingdom raised its production output to 10.31 million barrels per day, compared to 10.29 million barrels in March.
U.S. Crude Stockpiles
Worries of global fuel demand after the release of weak economic data from major economies have offset a report released this week showing a sharp drop in U.S. build of crude inventories.
U.S. oil inventories dropped 2.2 million barrels in the week through May 8, following a 3.9 million barrels fall a week before, the EIA report showed.
However, the inventory remains near the highest level for this time of year in at least 80 years.
Crude inventories fell by 2 million barrels in the week ended May 8, the American Petroleum Institute report said on Tuesday.
Later in the day, Baker Hughes will release its weekly U.S. rig count data.
The report released on May 8 showed a slowdown in U.S. oil-rig count to a fall by 11 to 668 active rigs after dropping 24 and 31 rigs the prior two weeks.
Crude oil futures for July delivery is currently trading around $59.80 a barrel after posting a low of $59.30.
Brent crude tumbled to a low of $65.35, while currently trading around $65.70.