What’s New in the Oil Market
Oil prices were down sharply last week, hitting a new low of $47.25 a barrel and trading below $35 a barrel.
The slump is likely to make it harder for China to lift its economic growth target for next year and could hurt the United States’ rebounding economy, which is struggling with a recession and slowing growth.
The U.S. Federal Reserve and other central banks are expected to raise interest rates on Thursday.
The oil market is a volatile market, with traders using it as a barometer of economic activity.
But it is also important to keep in mind that the dollar’s value has declined, so if oil prices are going to be a factor, it could be even more important than the dollar.
The drop in oil prices comes at a time when China is ramping up its economic stimulus.
The world’s second-largest economy is building infrastructure, and it is investing heavily in a new energy infrastructure project in the U.K. that is set to cost $2.5 billion.
The Chinese economy has been in a deep recession for years, and the country is now the world’s largest consumer of oil, accounting for more than 40 percent of global production.
But Beijing’s economy is growing at a rate that has slowed and it has become more dependent on oil imports.
“China is the world oil exporter, and China is the main supplier of the oil for China,” said Mark Weisbrot, an economist at Capital Economics.
China’s reliance on oil for the country’s economy has led to higher inflation and a slowdown in growth, especially in industrial production.
Weisbart said oil prices could help push up prices for U.C.L.A. stocks, a key driver of the company’s stock price.
In recent weeks, Chinese officials have been saying they will be ramping down the pace of economic stimulus, which includes boosting infrastructure spending.