WTI recovers lost ground below the $80.00 mark amid the fear of the Chinese debt crisis

• WTI holds below the $80.00 area amid the fear of China’s economic woes, higher for longer interest rate by the Fed.
• Higher oil prices might be supported by tighter supply caused by Saudi Arabia and Russia. 
• Hawkish comments by Fed Chairman Jerome Powell, China’s debt crisis dragged WTI prices lower. 
• Oil traders await US GDP, weekly Jobless Claims, and Nonfarm Payrolls due later this week.

Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around the $79.88 mark so far on Monday. Fears of a Chinese economic slowdown and the possibility of further Fed rate hikes weigh on the black gold in the early Asian session. OPEC+ production cuts, on the other hand, continue to support the oil market. 

Despite US sanctions, Iran's crude oil production is expected to reach 3.4 million barrels per day (bpd) by the end of September, according to the country's oil minister. Furthermore, US authorities are working on a proposal to ease sanctions on Venezuela. If Venezuela moves closer to free and fair presidential elections, it will be able to export more oil. This development boosts the upside for the WTI prices. 

Meanwhile, higher oil prices might be supported by tighter supply caused by Saudi Arabia and Russia's ongoing voluntary production curbs. According to Reuters, Saudi Arabia has said that it would maintain output at roughly 9 million barrels per day through September, a decrease of around 1 million barrels from August levels.

The Federal Reserve (Fed) Chairman Jerome Powell remarked on Friday at the Jackson Hole Economic Symposium that the central bank is prepared to hike interest rates further if required, and that the next rate rise would be determined by data. Powell also said that the robust economic growth and tight labor market conditions might pave the path for a tightening cycle to continue. This, in turn, might cap the upside for WTI prices as higher interest rates could raise borrowing costs, slow the economy, and diminish oil demand.

Furthermore, the fear of China’s debt crisis and real-estate woes might drag WTI prices lower. Last week, the People's Bank of China (PBoC) slashed its Loan Prime Rate (LPR) for one year by a smaller margin than anticipated. Investors will keep an eye on the Chinese Caixin Manufacturing PMI for August due on Friday. The concerns about China's deteriorating economic conditions should dampen market optimism and weigh on the WTI prices.

Moving on, oil traders will focus on the US preliminary Gross Domestic Product Annualized (GDP), Core Personal Consumption Expenditures (PCE) Index, and the weekly Jobless Claims due later this week The critical event will be the Nonfarm Payrolls (NFP) data on Friday. The events could significantly impact the USD-denominated WTI price. Oil traders will take cues from the data and find trading opportunities around the WTI prices.