Oil Rises More Than 1% on Chinese Demand Trends which increased for the second week
Oil rebounded around $1 per barrel on Friday. And it rose for the second week in a row as China’s economic outlook brightened. Bolster expectations for fuel demand in the world’s second-largest economy
Lifting restrictions on COVID-19 China’s production is likely to drive global demand to record highs this year. The International Energy Agency (IEA) said on Wednesday. A day after OPEC expects rebound in Chinese demand
Brent crude settled at $87.63 a barrel, up $1.47, or 1.7 percent, US crude to settle at $81.31 a barrel, up 98 cents, or 1.2 percent.
Naeem Aslam, analyst at Avatrade, said: “Many traders believe that it is highly likely that we will see an increase in demand from China. Because China continues to cancel the COVID policy.”
for this week Brent recorded a 2.8% increase and the US benchmark rose 1.8%.
Oil was also buoyed by hopes that the Federal Reserve will cut interest rates soon, which could brighten the outlook for the US economy.
A Reuters poll predicts the Fed will end its cycle of tightening after rising 25 basis points at each of its next two policy meetings. And then interest rates should be maintained at least for the remainder of the year.
Federal Reserve Vice President Lael Brainard said Thursday that opportunities for the US economy Going into a “soft landing” (soft landing) seems to be more. The Fed’s next rate-setting meeting is Jan. 31-Feb. 1.
also helped oil prices Baker Hughes Co. (BEC) It said the number of US oil rigs drilling fell by 10 to 613, the lowest since November.
Edward Moya, senior market analyst at OANDA, said the world’s two largest economies needed more crude oil.
“Oil markets tumble on fears of a global recession. But there are still signs that the tightness will continue for a bit,” he said.
oil rose despite US inventory numbers This week, crude inventories rose 8.4 million barrels in the week through Jan. 13 to about 448 million barrels, the highest since June 2021.
Andy Lipow, president of Houston-based Lipow Oil Associates, said the decline in U.S. Strategic Petroleum Reserve sales helped turn the negative from the report and push up oil prices.
Jim Ritterbusch of consulting firm Ritterbusch and Associates said Russia’s oil price restrictions which is a rippling force throughout the world market are boosting crude oil prices
“Russian sanctions and restrictions on crude oil are gradually increasing. affected by price And it will become even more positive with the influx of Russian raw materials into global markets last month,” Ritterbusch said.
Russia is China’s second largest crude supplier in 2022, while Saudi Arabia reigns supreme.
