Due to ongoing concerns over the growth of crude oil demand, Brent crude oil futures fell slightly in early Asian trading.

As of 12:00 Beijing time, Brent crude oil futures for October contract were at $79.57 per barrel, down 11 cents from the settlement price on August 16. The contract closed down $1.36. WTI crude oil futures for September contract were at $76.46 per barrel, down 19 cents from the settlement price on August 16. The contract closed down $1.51 on the same day.

Due to concerns about demand for PetroChina, oil prices have continued to decline. Pan Gongsheng, Governor of the People's Bank of China, said last week that the government will continue to provide support to ease the economic slowdown, but will not take any drastic measures.

Pan Gongsheng said that China will improve the central bank system and financial development, and focus on policies to maintain economic stability.

Due to the decline in refining profits, China's refineries reduced crude oil processing for the fourth consecutive month in July, hitting a 21-month low.

Although OPEC has lowered its forecast for oil demand growth, in its latest monthly oil market report, member states of OPEC+ are unlikely to change their plan to gradually return the voluntary reduction of 2.2 million barrels/day to the market from October. OPEC has lowered its forecast for oil demand growth in 2024 by 0.13 million barrels/day to 2.11 million barrels/day, and in 2025 by 0.06 million barrels/day to 1.78 million barrels/day. This prospect raises questions about whether some member states will begin to lift their production cuts in October. Although OPEC's latest data has increased concerns about the decline in oil demand, especially in the key market of China, the strong demand for increased production within OPEC+ member states may prompt the organization to maintain its existing production policy.

In addition, the reduction in the number of drilling rigs in the United States may limit further declines in oil prices. According to data released by Baker Hughes on August 17, the total number of drilling rigs in the United States decreased by 2 to 586 from the previous week. Among them, the number of oil drilling rigs decreased by 2 to 483; the number of natural gas drilling rigs increased by 1 to 98; and the number of other drilling rigs decreased by 1 to 5. Over the past year, despite US crude oil production approaching its historic high, the total number of drilling rigs has decreased by 56, reflecting companies' efforts to improve efficiency by drilling longer wells and accelerating completion times.

(The above content is from Argus, an independent international energy and commodity price assessment agency)