Commerzbank Expects Stable Oil Prices Amid Weak Chinese Demand

Commerzbank, in a research note published today, forecasted that crude oil prices will likely remain stable until the end of the year. This outlook is attributed to declining demand in the Chinese market, which has historically been the primary driver of global oil demand growth over recent decades.

The note emphasized that energy prices have experienced a notable decline since the beginning of the year, a trend expected to persist unless significant geopolitical tensions emerge. The bank pointed out that the drop in oil prices is mainly due to China's reduced demand, highlighting a shift in the global demand growth dynamic.

The German bank added that upcoming data on refining activities in Chinese refineries, set to be released next week, may indicate a slight increase in production. However, these figures are unlikely to alter long-term expectations of weak oil demand in China.

In parallel, Commerzbank predicted that stricter U.S. sanctions on Iran and other nations could reduce oil supply in the near future. This development might lead to a rebound in oil prices on global markets.

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