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WTI drops to around $81.50, Saudi Arabia expects rebound in oil exports to China

  • WTI prices struggled as Hurricane Beryl caused less damage than anticipated.
  • Saudi oil exports to China are expected to recover in August, potentially reaching a low of 44 million barrels.
  • Oil prices face challenges as a possible ceasefire deal in Gaza could ease supply threat.

West Texas Intermediate (WTI) crude oil prices extended losses for a third session, trading around $81.50 per barrel during Asian hours on Tuesday. Crude oil prices faced pressure after Hurricane Beryl, which hit a major oil production hub in Texas, caused less damage than anticipated by markets. Despite slowdowns in refining activity and evacuations at production sites, major refineries along the US Gulf Coast reported minimal impact from the hurricane.

This drop is believed to be partly influenced by recent developments involving Saudi Arabia. According to Reuters, Saudi crude oil exports to China are expected to recover in August, with shipments reaching at least 44 million barrels, boosting demand.

Exports to China from Saudi Arabia are set to rise in August for the first time in four months, climbing from about 36.00 million barrels in July. The rebound is expected to help the largest oil exporter regain its share of the biggest import market. Saudi exports to China had plunged to 1.12 million barrels per day (bpd) in June, the lowest level since March 2020, Reuters reported, using data from analytics firm Kpler.

Looking ahead, crude oil prices could face further challenges as market participants await progress in Middle East ceasefire negotiations. A potential ceasefire deal in Gaza could ease concerns about disruptions to global crude supply. However, according to the White House, there are significant differences between the parties involved, with Hamas expressing concerns about further Israeli actions in Gaza that could jeopardize the potential for a deal.

WTI Oil FAQs


WTI crude oil is a type of crude oil sold on international markets. WTI stands for West Texas Intermediate, one of three main types that include Brent and Dubai crude. WTI is also known as “light” and “sweet” for its relatively low gravity and sulfur content, respectively. It is considered a high-quality oil that is easily refined. It is sourced in the United States and distributed through the Cushing hub, considered “the pipeline crossroads of the world.” It is a benchmark for the oil market and the price of WTI is frequently quoted in the media.


Like all assets, supply and demand are the main factors determining the price of WTI crude oil. As such, global growth can be a driver of increased demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can disrupt supply and impact prices. Decisions by OPEC, a group of large oil producing countries, are another key driver of price. The value of the US Dollar influences the price of WTI crude oil, as oil is primarily traded in US Dollars, so a weaker Dollar can make oil more affordable and vice versa.


The weekly oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect fluctuations in supply and demand. If the data show a decrease in inventories, it may indicate an increase in demand, which would push up the price of oil. An increase in inventories may reflect an increase in supply, which pushes down prices. The API report is published every Tuesday and the EIA report the following day. Their results are usually similar, with a difference of 1% between them 75% of the time. The EIA data is considered more reliable because it is a government agency.


OPEC (Organization of the Petroleum Exporting Countries) is a group of 13 oil-producing nations that collectively decide on member countries’ production quotas at biennial meetings. Their decisions often influence WTI oil prices. When OPEC decides to reduce quotas, it can restrict supply and drive up oil prices. When OPEC increases production, the opposite effect occurs. OPEC+ is an expanded group that includes ten other non-OPEC countries, most notably Russia.

Source: Fx Street

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