Monday's crude trading patterns were virtually identical to the previous session in terms of what motivated traders and what they chose to ignore, and the outcome was also comparable, with Brent falling by 46 cents to $58.96 per barrel and West Texas Intermediate declining by 47 cents to $53.31.
As was the case last Friday, traders were said to be spooked by reports that China's economic growth slowed to 6 percent year-on-year in the third quarter, its weakest in over 27 years due to soft factory production and continuing trade tensions.
However, they ignored news that country's refinery output for September increased 9.4 percent year on year, and strong signal that petroleum demand remained robust.
Vandana Hari, founder and CEO, Vanda Insights
The bears are in control
As if to demonstrate just how jittery traders are, the one new disclosure on Monday that helped cause them to send prices downward yet again pertained to Wilbur Ross, the U.S. commerce secretary, who told media that even though president Donald Trump wants to sign a trade deal with China in November, "The key thing is to get everything right that we do sign: that's the important element [and] that's what the president is wedded to."
Adding to traders' distress were reports that Kuwait and Saudi Arabia will restart oil production from jointly-operated fields in the 500,000 barrel per day (bpd) Neutral Zone; this caused Stephen Innes, market strategist at AxiTrader, to remark, "Those extra barrels will come to market at a most unwelcome time."
Jim Ritterbusch, president of Ritterbusch and Associates, said in a report, "The complex remains trapped in a tight trading range amidst an ongoing tug of war between the supportive influence of a steady equity trade and the bearish influence of continued concerns over a major trade war that could force further slowing in global economic growth."
Meanwhile, Vandana Hari, founder and CEO of Vanda Insights, told CNBC that until the tariffs imposed throughout the U.S./China trade war go away, the headwinds preventing demand growth will prevail: "The bears are in control and it's hard for the market to sustain any substantial risk premium."