On Friday, oil prices became steady as reports of sluggish economic growth in China raised concerns over fuel demand. And this countered optimism from the signing of a U.S.-China trade deal this week.
In 2019, the world’s second-largest economy expanded by 6.1%. This is the slowest expansion seen in 29 years, according to government data.
She also said that the mounting downward economic pressure might limit oil’s upside in the mid- to long-term.
Then, Brent crude futures climbed 12 cents to $64.74. And this happened after obtaining almost 1% on Thursday. The U.S. West Texas Intermediate futures rose by 11 cents at $58.63 per barrel. It increased to more than 1% in the last session.
Moreover, oil boosted on Thursday following the signing of the Phase 1 trade agreement of the United States and China. After that, the mood further expanded after the U.S. Senate supported changes to the U.S.-Mexico-Canada Free Trade Agreement. As a result, it surges Chinese demand, as seen in refinery throughput figures offset the less optimistic economic growth data.
Back in 2019, Chinese refineries processed 651.98 million tonnes of crude oil. And this is equal to a record high of 13.04 million barrels a day, up by 7.6% from 2018. Also, throughput set a monthly record for December.
Meanwhile, the International Energy Agency offered a dim view of the oil market outlook for 2020 on Thursday. And OPEc supply will surpass demand for its crude. This will happen even though OPEC member states comply fully with output cuts agreed with Russia and other producers in a group called OPEC+.
Economist Howie Lee explained, “The next big factor I see on the horizon is whether OPEC+ would want to extend its cuts beyond Q1 2020, which at current price levels I think they might be incentivized to do.”
For this week, the United Arab Emirates’ energy minister stated that he expected a positive meeting when OPEC+ producers meet in March. As everyone knows, OPEC+ has been curbing oil output since 2017 to keep the balance of supply and demand and support prices.
Philippines’ Department of Agriculture
Elsewhere, the cost of damage to agriculture to the Taal volcano eruption has surged to PHP3 billion. And this is according to the Department of Agriculture (DA).
In the most recent damage report, the DA explained that total agricultural damages and losses covered as much as 15,790 hectares and 19,23 animal heads in the Calabarzon region.
In addition to that, the department mentioned that the fisheries sector became the most affected area. The estimated amount of losses is PHP 1.6 billion. And this is just for the culture of tilapia and some bangus species.
Other affected commodities by the eruption include coffee, cacao, pineapple, assorted fruits and vegetables, rice, and coconut.
The Bureau of Animal Industry has sent 20 bags of animal feeds, drugs, and medicines for the rescued livestock.