Oil prices drop on Monday morning in response to weak economic data from China. The development raises concerns about demand in the country, which is the world’s second largest consumer of oil.

A barrel of the European reference oil, Brent, costs USD 79.21 on Monday morning, compared to USD 79.85 on Friday afternoon. At the same time, US West Texas Intermediate (WTI) oil is trading at USD 74.79 compared to USD 75.35 on Friday afternoon.

New data from the Chinese National Bureau of Statistics shows that China’s gross domestic product grew only 0.8%, in seasonally adjusted figures, over April-June compared to the first quarter of the year. The development highlights a faltering recovery of the Chinese economy following the reopening of the country as a result of weaker demand.

”The GDP came in below expectations, so will do little to ease concerns over the Chinese economy,” says Warren Patterson, head of commodities research at ING, according to Reuters.

Chinese refineries processed 1.6% more oil daily in June than in May after a maintenance in the spring. Patterson points out that despite apparently growing demand, the market remains focused on the development of the country’s gross domestic product, Reuters writes.

It is also believed that the Chinese government will be cautious about providing new economic stimulus for fear of driving up oil prices, according to Stefano Grasso from 8vantedge, as cited by Reuters.

”They are stockpiling crude at low prices, and waiting for recession to hit the West, before going full on with stimulus,” he says.

On the supply side, Libya resumed production over the weekend in two of three oil fields that were shut down on Thursday due to protests following the kidnapping of a former minister. The last oil field remained closed on Monday.

Elsewhere in the commodities market, a troy ounce of gold cost USD 1,951.97 on Monday morning, compared to USD 1,960.56 on Friday afternoon.