The price of crude oil was lingering around the $78-mark on Wednesday, amid concerns over diminishing demand and on worries that China will slow its lending spree. Reports said that China had ordered some banks to cease lending for the rest of January after they had exceeded their credit limits.
A stronger dollar also weighed on investors' sentiment. The U.S. dollar was edging up against euro, British Pound and Canadian dollar, while easing versus the yen.
NYMEX Light Sweet Crude Oil (WTI) futures for March 2010 were at $78.06, down $1.23 a barrel.
The Chinese central bank raised interest rates on one-year bills, to help soak up extra money in the system. It has also ordered a few banks to increase their reserve ratios by 0.5% to 16%. Interestingly, these announcements came in just before the country scheduled to release its fourth quarter GDP figures on Thursday. Analysts see China's economic growth to have remained robust at over 10% on an annual basis.
Furthermore, the OPEC's Monthly Oil Market Report for January, released Tuesday, forecasts a flat world oil demand in 2010 and argued that fundamentals are not behind the recent oil market behavior. OPEC also noted that oil inventories remain at high levels and are enough to handle any unexpected increase in demand.
Some of today's trading action may be guided by crude oil inventories report by API and Producer Price Index by the Department of Labor.
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May 15, 2026 15:25 ET Apart from the confirmation of Kevin Warsh as the next Fed chair, the main news on the economics front this week included key price data from the U.S. and the first quarter economic growth figures from major economies. Both consumer prices and producer costs have started to reflect the effect of supply shocks due to the Middle East conflict. In Europe, GDP data was in focus, while inflation data from China dominated the news flow in Asia.