Oil falls as Chinese, US economic data raise fuel demand concerns
Brent crude futures fell 39 cents, or 0.58%, to $66.45 a barrel by 0750 GMT. U.S. West Texas Intermediate crude futures declined 42 cents, or 0.66%, to $63.54.
For the week, WTI is set to drop 0.5% while Brent is set to decline 0.2%.
Chinese government data released on Friday showed factory output growth slumped to an eight-month low and retail sales growth expanded at its slowest pace since December, weighing on sentiment despite stronger oil throughput in the world's second-largest crude user.
Government data released on Friday showed throughput at Chinese refineries rose 8.9% year-on-year in July, however, that was down from June levels, which were the highest since September 2023. Despite the rising throughput, China's oil product exports last month were also up from a year ago, suggesting lower domestic fuel demand.
Forecasts of a growing oil market surplus also weighed on sentiment, as did the prospect of higher-for-longer U.S. interest rates.
Bank of America analysts said in a Thursday note they were widening their forecast for the oil market surplus citing growing supplies from OPEC+, a group consisting of the Organization of the Petroleum Exporting Countries, Russia and other allies.
The analysts now project an average surplus of 890,000 barrels per day from July 2025 through June 2026.
That forecast follows predictions earlier this week from the International Energy Agency saying the oil market looks "bloated" after the OPEC+ increases.
In the U.S., higher-than-expected inflation data and weak jobs numbers have raised concerns that the Federal Reserve is less likely to cut interest rates next month. Lower rates typically boost economic activity, which is a positive for oil demand.
Investors are also awaiting Friday's meeting between Trump and Putin in Alaska where a ceasefire in the Ukraine war is at the top of the agenda and ahead of which Trump had said he believes Russia is prepared to end the war in Ukraine.
A ceasefire could lead to the easing of sanctions on Russian oil supply.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
16 minutes ago
- The Independent
Nexstar CEO praises Trump administration as local TV giant announces $6.2 billion merger with rival
Nexstar, the largest owner of local television stations in the United States, announced on Tuesday that it would be acquiring rival Tegna in a $6.2 billion mega-deal that would reshape the landscape of local media as the Trump administration seems poised to loosen regulatory limits. In fact, seemingly alluding to the presumption that Donald Trump's handpicked FCC chief Brendan Carr would approve the deal despite current restrictions in place, Nexstar CEO Perry Sook heaped praise on the administration in his company's announcement of the deal. 'The initiatives being pursued by the Trump administration offer local broadcasters the opportunity to expand reach, level the playing field, and compete more effectively with the Big Tech and legacy Big Media companies that have unchecked reach and vast financial resources,' Sook said in a statement. 'We believe TEGNA represents the best option for Nexstar to act on this opportunity.' As Deadline's Dade Hayes reported, the merger 'challenges decade-old limits on control of local media' as the new company would control 265 local TV stations across 44 states and the District of Columbia, representing about 80 percent of American households. This would far exceed the current limit of 39 percent, which has been in place for the past three decades through both Democratic and Republican administrations. Making his intentions crystal clear shortly after Trump's 2024 electoral victory that he sought an end to the broadcast station ownership cap, Sook declared in November that he hoped GOP control of government would help usher in an expansion of his company. 'It's evident that the antiquated ownership caps applied to broadcasters do not reflect the reality of today's competitive media environment,' Sook said at the time. 'We believe that there is value to be created for our shareholders through further consolidation, while driving true and new benefits to the American people who want and deserve fact-based, unbiased local news.' Citing his company's upstart 'centrist' cable news channel NewsNation, Sook also appeared to offer up some 'fair-and-balanced dog whistling' by reiterating Nexstar's commitment to 'eliminating the level of activist journalism out there' while asserting that 'maybe fact-based journalism will come back into vogue.' Ahead of Tuesday's announcement, public interest group Free Press (not to be confused with Bari Weiss' similarly-named 'anti-woke' outlet) warned that Nexstar and Tegna were striking a 'devil's bargain' with the proposed merger. 'Under any previous administration, such a combination would have been unthinkable,' Free Press co-CEO Craig Aaron wrote. 'Under Donald Trump, it's just a question of how much of your independence and integrity you're willing to sacrifice to get a deal done.' Carr has been outspoken about his willingness to deregulate broadcasting ownership rules and ditch the 39 percent national cap. Before beginning FCC proceedings in June to change the rules, Carr complained about the 'arcane, artificial limits on how many TV stations any one company can own.' 'So I want to ultimately empower those local stations and, frankly, constrain some of the power of those national programmers,' he added at the time. Additionally, Nexstar – which merged with Tribune Media in 2019 and owns the majority of The CW network – has found ways to dodge Trump's anti-media lawsuits while other media conglomerates continue to be targeted. Semafor reported in April that Nexstar was dropped from a Truth Social defamation complaint when the company's digital media outlet The Hill fired a breaking news reporter who had written an aggregated story about the Trump-owned platform's earnings. A Nexstar spokesperson denied that the company fired the reporter in exchange for being dropped from the lawsuit. The merger, which Nexstar announced would take place in the second half of 2026, is still far from a done deal. The Wall Street Journal reported this week that Sinclair, the nation's second-largest local TV broadcaster, has also offered to merge with Tegna. In preparation for the deal, Sinclair has offered to spin off some of its nontraditional media and cable assets – which include the Tennis Channel – in order to merge its remaining broadcast channels with Tegna. Meanwhile, local reporters are sounding the alarm over what a Nexstar-Tegna merger would mean for their industry. 'Media consolidations are rarely a good thing, and the Buffalo market is likely to be ill-served by a Nexstar-TEGNA merger,' Buffalo-based investigative reporter Jim Heaney observed. 'Competition is likely to take a hit and a downsizing of the joined operations is likely, although the stations would maintain separate newsrooms.' As 'local broadcast television is edging toward one of the biggest consolidation waves in its history,' Hayes noted that this proposed deal stands 'in sharp contrast to the punitive approach to the Paramount-Skydance merger.' Of course, in that instance, Carr spent months accusing CBS of 'news distortion' while Trump secured a $16 million settlement of a 'meritless' lawsuit over a 60 Minutes interview shortly before the FCC approved the merger.
Reuters
17 minutes ago
- Reuters
S&P affirms 'AA+' credit rating for US, cites impact of tariff revenue
Aug 19 (Reuters) - S&P Global on Monday affirmed its "AA+" credit rating on the U.S., saying the revenue from President Donald Trump's tariffs will offset the fiscal hit from his massive tax-cut and spending bill. Trump signed the "One Big Beautiful Bill Act" into law in July after it was passed by the Republican-controlled Congress. The bill, which delivered new tax breaks, also made Trump's 2017 tax cuts permanent. "Amid the rise in effective tariff rates, we expect meaningful tariff revenue to generally offset weaker fiscal outcomes that might otherwise be associated with the recent fiscal legislation, which contains both cuts and increases in tax and spending," S&P said in a statement. "At this time, it appears that meaningful tariff revenue has the potential to offset the deficit-raising aspects of the recent budget legislation." The U.S. reported a $21 billion jump in customs duty collections from Trump's tariffs in July, but the government budget deficit still grew nearly 20% in the same month to $291 billion. Interest on the public debt also continued to grow, hitting $1.013 trillion in the first 10 months of the fiscal year, an increase of 6%, or $57 billion, over the prior-year period due to slightly higher interest rates and increased debt levels. Since returning to power in January this year, Trump has launched a global trade war with a range of tariffs that have targeted individual products and countries. The Republican president has set a baseline tariff of 10% on all imports to the U.S., as well as additional duties on some items and trading partners. S&P, which became the first ratings agency to cut the pristine U.S. government rating in 2011, said the outlook on the U.S. rating remains stable. The ratings agency said it expects the Federal Reserve, which Trump has criticized this year for not cutting interest rates, "to navigate the challenges of lowering domestic inflation and addressing financial market vulnerabilities." It projected the country's general government deficit to average 6.0% of GDP during the 2025-2028 period, down from 7.5% in 2024 and from an average 9.8% of GDP in 2020-2023. S&P said it could lower the rating over the next two to three years if already high deficits increase. "The ratings could also come under pressure if political developments weigh on the strength of American institutions and the effectiveness of long-term policymaking or independence of the Federal Reserve," it said. S&P, however, said it could raise the U.S. rating in the event of sustained economic growth and adjustments to the U.S. fiscal profile that would diminish recent increases in the country's debt burden. There was no reaction in markets on Tuesday to S&P's credit rating affirmation, which follows a U.S. sovereign credit downgrade by Moody's in May, when that ratings agency cut the triple-A U.S. rating by one notch, citing rising debt levels. The U.S. national debt load surged above a record $37 trillion last week. James Ragan, co-chief investment officer and director of investment management research at D.A. Davidson, said the S&P rating affirmation was an acknowledgment of the meaningful tariff revenue generated so far. "That's all good revenue (coming) in, but that's also a drag on the economy, so I think we don't know the impact of that going forward," he said.
Daily Mail
17 minutes ago
- Daily Mail
A key part of the Trump coalition begins to crumble as the president hits his lowest approval rating
Support for Donald Trump has tumbled as his term has progressed, with the latest poll showing his approval rating at its lowest point all year. The latest Reuters/Ipsos poll of nearly 4,500 Americans found that the president is carrying a 40 percent approval rating. That level of support, the lowest of the president's second term, ties Trump's approval rating from the same pollsters just weeks ago in late July. Trump's disapproval rating ticked slightly down in the latest survey to 54 percent. The 79-year-old president's disapproval stood at 56 percent as of July 27. It is a seven-point drop in support for the president from the beginning of his term, when Trump had a 47 percent approval rating. At this point in his term, former President Joe Biden maintained a 50 percent approval rating, according to a Reuters/Ipsos poll taken in August 2021. The slumping approval rating comes amid signs that the U.S. economy is weakening and high-stakes diplomatic negotiations with Russia and Ukraine to end their ongoing war continue. Over half of the respondents, 54 percent, including a quarter of Republicans, said they believe Trump is too closely aligned with Russia. A man shouts at Rep. Chuck Edwards (R-NC) during a congressional town hall meeting on March 13, 2025 in Asheville, North Carolina. The event came as Republicans have faced protestors at town halls critical of the Trump administration slashing federal jobs Notably, Trump bled support among Hispanics as he oversees a sweeping nationwide immigration crackdown that has led to at least 300,00 repatriations. Just 32 percent of Hispanics in the latest Reuters/Ipsos survey approved of the president's performance. Support for Trump came predominantly from registered Republicans. Only 42 percent of respondents voiced support for the president's performance on crime, and 43 percent said he is doing a good job on immigration. When it comes to the economy, just 37 percent approved of Trump's job. The survey was administered the same week Trump announced he was federalizing the Washington, D.C., police force and deploying additional National Guard troops to the district. Other recent polls, meanwhile, have shown more support for the president's job performance. According to the RealClearPolitics polling average, Trump's approval sits at 46 percent while his disapproval rating is 51 percent. An Insider Advantage poll also taken last week showed Trump with a 54 percent approval and a 44 percent disapproval. The latest poll from the Daily Mail/J.L. Partners similarly found higher support for the president in late July. Forty-nine percent of voters signaled approval of Trump's job performance as president, up one point from the tracking survey conducted earlier in July. But he was underwater as 51 percent disapprove of Trump's job performance, down one point from earlier in the month.
