- Disappointing Chinese data weigh on crude oil on Monday.
- Saudi energy minister says there is no cause for worry.
Crude oil started the week on the backfoot on Monday as the data published from China brought back concerns over an economic slowdown in the world’s second-largest oil consumer. After snapping its 8-day winning streak last Friday, the barrel of West Texas Intermediate extended its losses and touched a daily low of $50.40 before staging a modest recovery in the second half of the day. As of writing, the WTI was down 50 cents, or nearly 1%, on the day at $51.10.
The trade balance report from China revealed that exports contracted by 4.4% on an annual basis in December, posting its largest decline in two years and reminding markets of the negative impact of the trade conflict with the United States.
Despite that disappointing data from China, however, Saudi Arabian Energy Minister Al-Falih argued that the global economy was strong and there was no cause for worry. “OPEC+ will meet commitments to cut output,” Al-Falih added and announced that he will be attending the next OPEC+ meeting, which is likely to be held in Baku.
Technical levels to consider
The WTI could face the first resistance at $52 (50-DMA) ahead of $53.30 (Jan. 11 high) and $54.50 (Dec. 4, 2018, high). On the downside, supports are located at $50.40 (daily low), $49.70 (Jan. 9 low) and $48.30 (Jan. 8 low).