Oil smoked in a 4% decline. On track for the lowest close since 2021

WTI now has a $65 handle.

It’s down 4% on the day or $2.75 to $65.96, which is the worst level since May 2023. It’s traded down here on a handful of days in 2023 but if it finishes here it would be the worst close since December 2021.

Needless to day, it’s not a good day for OPEC. The group earlier today took down its 2024 demand growth forecast to 2.03 mbpd from 2.11 mbpd in last month’s report, largely based on less China demand growth. For next year, they see an additional 1.74 mbpd down from 1.78 mbpd previously.

Those numbers are nearly 1 mbpd less than EIA forecasts.

The market initially shrugged off the OPEC forecasts but when combined with poor Chinese import data, it paints a picture of a slowing global economy.

I think there is something of a capitulation here for the oil bulls with crude down in 6 of the past 7 days but it’s not clear what might turn the tide.

This article was written by Adam Button at www.forexlive.com.