Why Have Oil Prices Dropped And What to Make of China’s Reduced Demand

Oil prices have dropped to their lowest level since before the war in Ukraine, after Saudi Arabia and other OPEC+ countries were reported to be considering increasing their output after China’s tightened COVID restrictions.

Will significantly-low oil prices genuinely hurt the outlook for U.S. demand, and what other geopolitical forces are at play? Economist Tim Snyder at Matador Economics give his take on recent affairs.

Tim’s Thoughts

“If you try to figure out what’s going on in the energy complex, there are three simple words that define what’s going on. Those words are demand, demand and demand. I’ve said this many times over the years, but the primary driver for prices in the energy complex is demand, and that is exactly what is driving the price of crude oil, gasoline, and diesel lower today.

This week the Chinese government sent a message to the Saudis to ask them to ship less crude oil, not more, but less crude oil to Chinese ports as they’re still struggling with the COVID crisis. They had a solid fall, and a growing crisis coming this winter, and demand is falling in China.

After this week’s missile threat, from a missile that landed in Poland, killing two people, the geopolitical tension spiked. But then it eased rather quickly when it was determined that the missile strike was an accident. The retreat from full military readiness helped to accelerate the downward pressure on crude oil process that we saw this week.

Additionally, since the [Russians] didn’t launch the missile, there’s no need for NATO to respond, and things are cooling down.”

Follow us on social media for the latest updates in B2B!



sustainability impact report
A Look Into MG2’s Sustainability Impact Report
April 22, 2024

When businesses invest in building strategies around a sustainability impact report, it’s a win-win for the environment, the company, and the community the business serves. The architecture and design industries face renewed pressure to innovate sustainably in an era marked by rapid environmental shifts and an escalating climate crisis. As businesses and individuals become […]

Read More
Oosto CEO, Avi Golan, on facial recognition technology
Facilities Housing Vulnerable Populations can Utilize Facial Recognition Technology to Detect and Locate
April 19, 2024

As technology demands evolve and see changes, the area of facial recognition technology can be of great use for vulnerable populations. As it stands, the integration of facial recognition technology and behavior analytics can enhance the safety and operational efficiency in sensitive environments like assisted living facilities.  Avi Golan, CEO at Oosto, and Dieter […]

Read More
Women's empowerment
Seizing the Narrative: The Transformative Impact of Storytelling on Women’s Empowerment
April 19, 2024

With gender equality becoming a significant global agenda, the narrative around women’s empowerment is more relevant than ever. Amid rising awareness and shifting societal norms, women are increasingly seeking avenues for self-expression and empowerment. A recent study by the Global Gender Gap Report highlights that while progress is being made, substantial efforts are still […]

Read More
V2G technology
Plug into the Future: Decoding V2G for Utility Applications
April 19, 2024

Brian Rudy from Verizon IoT and Melissa Chan of Fermata Energy explore the cutting-edge potential of vehicle-to-grid (V2G) technology at DISTRIBUTECH 2024. Their discussion highlights how this innovation transforms electric vehicles into dynamic energy storage units, capable of stabilizing the grid by storing and discharging power as needed. This technology represents a significant shift […]

Read More