Oil prices have decreased after China could not set an economic growth target for this year, which sparked concerns that the fallout from the coronavirus pandemic continues to depress fuel demand in the country.
Brent crude was down $1.38 at $34.68 a barrel, while US West Texas Intermediate (WTI) crude dropped by $1.79 to $32.13 a barrel, Reuters reported.
Oil prices have witnessed gains for the past four weeks after the historic crash of US crude to below zero seen last month.
China’s National People’s Congress (NPC) launched a week-long meeting with the government saying it omitted this year’s growth target, while pledging to issue CNY1tn ($140bn) of special treasury bonds to support companies and regions hit by the outbreak.
AxiCorp chief global market strategist Stephen Innes was quoted by the news agency as saying: “Abandoning the growth target could be interpreted as putting less focus on infrastructure investment and could be viewed as negative for oil.
“The commodity market, in general, was looking for a bigger infrastructure pump from the NPC so there is bound to be an element of disappointment.”
Meanwhile, growing tensions between the US and China over Beijing’s plan to implement national security law in Hong Kong also hit commodities as well as other markets.
Phillip Futures commodities senior manager Avtar Sandu said: “Concerns over geopolitical and trade issues … remain amid signs of improving demand and production cuts by major oil producers.”
According to data from Reuters, easing coronavirus-related restrictions is driving a recovery in gasoline demand with traffic congestion in some of the world’s capitals returning to last year levels.