Oil prices drop more than 1% as China demand data disappoints

SINGAPORE, Oct 24 (Reuters) – Oil prices fell more than 1% on Monday after Chinese data showed demand from the world’s biggest crude importer remained lackluster in September amid strict COVID-19 policies and fuel export restrictions that have reduced fuel consumption.

Brent futures for December settlement fell $1, or 1.1%, to $92.50 a barrel at 0609 GMT after rising 2% last week. U.S. West Texas Intermediate crude for December delivery was at $84.02 a barrel, down $1.03 or 1.2%.

Although higher than August, China’s September crude imports, at 9.79 million barrels per day, were 2% lower than a year earlier, customs data showed on Monday, as independent refiners cut throughput amid thin margins and lackluster demand.

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“The recent recovery in oil imports faltered in September,” ANZ analysts said in a note, adding that independent refiners did not use the quota increase as ongoing COVID-related lockdowns weighed on oil. Requirement.

“This has been exacerbated by declining refining margins and commodity export restrictions,” analysts said.

Saudi Arabia and Russia were neck and neck among China’s top two suppliers in September.

Uncertainty around China’s zero-COVID policy and housing crisis are undermining the effectiveness of pro-growth measures, ING analysts said in a note, even as gross domestic product (GDP) growth in the third quarter exceeded expectations.

The GDP data came a day after China’s Xi Jinping won a third term in office on Sunday, cementing his place as the country’s most powerful leader since Mao Zedong.

Brent crude rose last week despite US President Joe Biden’s announcement to sell the remaining 15 million barrels of oil from US Strategic Petroleum Reserves. The sale is part of a record 180 million barrel release that began in May.

Biden added that his goal would be to rebuild inventories when U.S. crude nears $70 a barrel.

“Biden’s comments that the US will only buy crude when prices hit $70/bbl provide a strong level of support,” ANZ said.

U.S. energy companies last week added oil and gas rigs for the second straight week as relatively high oil prices prompted companies to drill more, energy services firm Baker Hughes Co said in a report on Friday. .

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Reporting by Florence Tan; Editing by Christian Schmollinger and Jamie Freed

Our standards: The Thomson Reuters Trust Principles.

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