Oil drops 1% amid weak Chinese GDP data, Libyan production resumes

SINGAPORE, July 17 (Reuters) – Oil prices fell for a second straight session on Monday after Chinese economic data showed a slowdown in the second quarter, adding to concerns about domestic demand. The resumption of production in Libya over the weekend also put pressure on prices.

Brent crude oil futures fell at 09:20 Moscow time by 1.21% to $78.9 a barrel, WTI fell 1.26% to $74.47 a barrel.

China’s economy grew at a slower pace in the second quarter amid weakening demand at home and abroad, and momentum from the recovery from the COVID-19 crisis was fading fast.

“GDP figures are below expectations, so they will do little to ease concerns about the health of the Chinese economy,” said Warren Patterson of ING.

Chinese refineries processed 1.6% more oil in June than in May as they accelerated after spring maintenance, NBS data showed, in line with high oil imports by the world’s largest importer last month.

“Demand for oil has grown at a strong year-on-year rate, but the market seems to be focused on the fundamentals (GDP),” Patterson said.

Last week, both benchmarks posted a third straight weekly gain and reached April highs after production in Libya shut down and Shell stopped exporting Nigerian crude, limiting supplies.

Two of the three Libyan oil fields closed on Thursday – Ash Sharara and El Fil, with a combined production capacity of 370,000 tons.

Work on several oil fields in Libya was suspended on Thursday amid protests by a local tribe in response to the kidnapping of a former minister.

The original message in English is available under the code: (Florence Tan)