China's Crude Oil Imports Dropped 1.3%, What's the Reason?

Inflation data released Thursday morning in China showed a sharper-than-expected drop in February, suggesting that China’s manufacturing sector is operating well below full capacity.

 

In this regard, the Chinese government set a lower-than-expected GDP target for 2023 over the weekend, raising doubts about the strength of China’s likely economic recovery this year.

 

Earlier this week, data released showed that China’s crude oil imports fell 1.3% from a year earlier in the first two months of 2023, adding to negative sentiment on global crude oil prices.

 

However, global crude oil prices rose again after hawkish comments from Federal Reserve Chairman Jerome Powell. Powell made it clear that interest rates would rise more than previously expected if economic data showed that they were needed to combat inflation.

This could have a positive impact on economic growth and demand in the world’s largest crude oil consumer.

 

The hawkish comments also helped support the US dollar, which rose to a three-month high against a basket of rival currencies. However, there is still uncertainty about global supply, with S&P Global Vice Chairman

 

Dan Yergin saying that Russia could maintain crude production for longer than many had expected, despite the exodus of many Western companies and sanctions from the US and its allies.

 

World crude oil prices experienced a correction in the previous two sessions due to weak Chinese economic data. However, world crude oil prices rose again after hawkish comments from Federal Reserve Chairman Jerome Powell. However, there is still uncertainty about global supply.