By Bozorgmehr Sharafedin
LONDON (.) – Oil prices fell on Wednesday after United States President Donald Trump said he was working on a firm response to China’s proposal to implement a security law in Hong Kong.
* A possible deterioration in relations between the world’s two largest economies could increase pressure on companies and global demand for oil, which are already weakened by the coronavirus pandemic.
* Brent crude
* “Beyond market fundamentals are improving, there are still many problems before we can anticipate a bullish outlook. These include the most recent dispute between the United States and China,” said Stephen Brennock of the PVM brokerage.
* Even more negative forecasts about the impact of the pandemic on large economies also plagued oil prices.
* The euro zone economy will probably contract between 8% and 12% this year, said the president of the European Central Bank, Christine Lagarde, warning that the less serious scenario evaluated by the ECB has already been ruled out, so its current forecast it is based on the expectation of a moderate to severe crisis. [nL8N2D91RS]
* Operators were also paying attention to preliminary signs of a meeting between the Organization of the Petroleum Exporting Countries (OPEC) and its allies that could take place in less than two weeks.
* The group, known as OPEC +, is cutting production by almost 10 million barrels per day (bpd) in May and June, but markets are wondering if it will continue to do so after global demand begins to recover due to a relaxation of quarantines in many countries.
(Report by Bozorgmehr Sharafedin in London. Additional report by Aaron Sheldrick in Tokyo. Edited in Spanish by Marion Giraldo)