Oil’s price drop Tuesday to the lowest finish in three-and-a-half months may come as a surprise to traders focused on the risk of crude supply disruptions in the Middle East, but not so much to those who have assessed the latest global economic data.

Some economic data have pointed to the potential for a slowdown in energy demand.

On Tuesday, oil prices fell on the back of a slowdown in China’s oil demand, which has come not only because of lower than expected economic growth, but because of lower exports of petroleum products, said Anas Alhajji, an independent energy expert and managing partner at Energy Outlook Advisors.

China trade data show that the country imported 13.5% more crude in October than a year ago, according to news reports, but the year-ago figure was low due to coronavirus restrictions that were in place in 2022.

On its own, the crude-oil import data are bullish, but that is “not the case when we look at inventories, exports, and refinery runs,” said Alhajji. “Refinery throughputs are declining, inventories are rising, and exports are decreasing.”

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