WTI oil price has fallen for the third consecutive day. The economic troubles in China are weighing on WTI oil price.
Oil traders are awaiting the US Purchasing Managers' Index (PMI) and speeches from the Federal Reserve (Fed) at the annual economic symposium in Jackson Hole.
The US benchmark crude oil, West Texas Intermediate (WTI), traded around $79.65 on Wednesday. WTI oil price is still facing selling pressure due to concerns about China's demand outlook.
Market concerns over China's debt crisis and real estate troubles are dragging down WTI oil price. On Monday, the People's Bank of China (PBoC) lowered the one-year loan prime rate (LPR), but the reduction was smaller than expected. The PBoC decided to cut the one-year LPR by 10 basis points to 3.45%, while keeping the five-year LPR unchanged at 4.2%. The Chinese government stated that it would arrange fiscal support to address local government debt issues. However, the lack of progress in stimulus measures could trigger further selling of WTI oil price as China is a significant consumer of petroleum globally.
Additionally, the American Petroleum Institute (API) reported on Wednesday that US crude oil inventories totaled -2.418 million barrels for the week ending August 18, compared to -0.6195 million barrels the previous week.
The oil ministers of Iraq and Turkey have both emphasized the importance of restoring oil transportation after pipeline projects are completed. Market participants will be watching closely if Iraq resumes crude oil exports through the Basra-Jayhan oil terminal to ease supply tensions.
Looking ahead, oil traders will closely monitor the Energy Information Administration's weekly crude oil inventory change as of August 18, and the Standard & Poor's global purchasing managers' index to be released on Wednesday. Later this week, the focus will shift to the annual Jackson Hole symposium on Thursday and a speech by Federal Reserve Chairman Powell on Friday. These events could have a significant impact on WTI oil price denominated in US dollars. Traders will seek clues from the data and look for trading opportunities in WTI oil price.
