Oil prices have declined as China lowered its economic growth target this year, dimming the outlook for fuel demand.
Brent crude futures were down 30 cents at $65.37 per barrel, while US West Texas Intermediate (WTI) crude oil futures slipped 28 cents at $56.31 per barrel, Reuters reported.
TS Lombard energy analysts told the news agency: “Near term, it is hard to get very bullish on oil prices. The market is still working off the surpluses built in H2 2018, keeping OECD commercial inventories stuck above the five-year average.”
The economic growth target released in Premier Li Keqiang’s annual work report was set at a range of 6% to 6.5%, which is down from 6.6% in 2018.
The lower bound of the target is the slowest pace of economic growth in almost three decades, Bloomberg reported.
Supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) and expectations on a trade agreement between the US and China offered some support to oil prices.
China’s commerce minister Zhong Shan said trade talks have been difficult, but working teams from both countries are still carrying out their discussions.
OPEC, which has led efforts to withhold around 1.2 million barrels per day (bpd) of supply, said this week that cuts will continue at least until June 2019.
The supply cuts have led to an increase in the Brent international crude price benchmark due to a shortage of the heavy crudes mostly produced by the OPEC.