Oil quotations fell by 4% against the background of worsening economic situation in China

Oil prices fell to a 3-month low on news of a reduction in goods exports from China and a sharp increase in US oil supplies.

January Brent oil futures fell 4.2% to $81.6/bbl yesterday, and December WTI oil futures fell 4.5% to $77.4/bbl on macroeconomic data from China , which indicate a slowdown in the development of the world's second largest economy and a possible reduction in global oil demand.

In addition, the advance of Israeli troops in Gaza and the fight against Hamas, as well as the diplomatic work of the United States to settle the situation in the Middle East, are putting pressure on oil quotes.

The volume of exports from China has been declining for six months, and fell by 6.2% in September and by 6.4% in October compared to the same period last year. Declining demand for Chinese goods and plans by foreign companies (such as Apple) to move their production to other Asian countries have led to China's trade surplus becoming the worst in 17 months. Exports of goods have been the main driver of China's economy, so a drop in demand could slow the country's economy and reduce oil consumption, which is already quite low in the country, in particular due to the rapid increase in the production of electric cars.

Most of the oil imported to China is consumed by export-oriented refineries. Not long ago, the country's authorities limited the work of such enterprises in order to reduce carbon dioxide emissions. In addition, China is gradually increasing its oil reserves by buying cheap oil from the Russian Federation, which may soon lead to a reduction in imports.

The decline in oil prices will again increase the pressure on the prices of vegetable oils in the near future.

Yes, yesterday December palm oil futures on the exchange in Malaysia fell by 0.9% to 3,720 ringgits/t or $797/t, and December soybean oil futures in Chicago fell by 2.6% to $1,090 /t (-9% for the month).