WTI EXTENDS ITS DECLINE BELOW $76.50 AMID CHINA DEMAND CONCERNS, EYES ON FED RATE DECISION

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  • WTI attracts some sellers near $76.25 in Tuesday’s Asian session, down 0.45% on the day. 
  • The weaker outlook for crude demand in China weighs on the WTI price. 
  • Rising geopolitical tensions in the Middle East are likely to disrupt oil supplies, capping the downside for Oil prices.

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $76.25 on Tuesday. WTI price extends its decline to the lowest level since June 10 amid the Federal Reserve's (Fed) rate cut expectation in September and China’s weaker demand. 

The Fed is anticipated to keep interest rates unchanged in the range of 5.25%-5.50% for the eighth time in a row at its July meeting on Wednesday. Traders will also take more cues from the Fed Press Conference for the interest rate cut path. Anydovish messages from the US central bank could be positive for risk-sensitive assets like WTI price. 

Additionally, the weaker demand and sluggish economy in China weigh on WTI price as China is the top largest consumer of oil in the world. China's total fuel oil imports fell by 11% in the first half of 2024, according to the data released earlier this month. "The economic problems in China are also sucking the juice out of the oil market," said Bob Yawger, director of energy futures at Mizuho in New York.


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