The valuations in natural resources are unbelievable: David Taylor
Oil struggled to find direction as broader market concerns countered hopes for a big rebound in Chinese demand.
West Texas Intermediate traded near US$80 a barrel. Disappointing tech earnings dragged markets lower, while weaker business activity reinforced Wall Street worries about the U.S. economy. The dour outlook comes after China’s reopening spurred some gains in the commodity.
Oil markets “are coming undone a little bit,” said Bob Yawger, director of the futures division at Mizuho Securities USA. Economic concerns combined with swelling U.S. crude inventories are weighing on the commodity, he said. While U.S. supplies rose by less than expected last week, they remain at the highest level since June, according to government data released Wednesday.
Oil is largely unchanged for the month after a weak start to the year. The outlook for China and a weaker dollar — which makes commodities priced in the currency more attractive — have helped oil claw back some ground. Traders will be closely watching signs of increasing Chinese demand once the lunar New Year festivities have concluded.
- WTI for March delivery rose 39 cents to US$80.52 a barrel at 1:33 p.m. in New York.
- Brent for the same month rose 16 cents to US$86.29 a barrel.