The price of Brent crude oil has dropped below US$80 a barrel in midday Asian trade, marking a decline of 2% from yesterday’s levels. This latest drop is attributed to a combination of factors, including rising supply and weakening demand.
On the supply side, oil inventories in the United States have reached their highest levels since February, indicating an abundance of crude oil in the market. Additionally, the easing of sanctions on Venezuela has enabled the country to increase its oil production, further adding to global supply.
On the demand side, China, the world’s second-largest oil consumer, is signaling weaker demand. The country’s total exports of goods contracted faster than expected, while consumer prices fell by 0.2% in October, suggesting a slowdown in economic activity.
The interplay of these supply and demand dynamics has pushed Brent crude oil to its lowest level since mid-July, trading at US$79.60 a barrel in midday Asian trade.
