Oil prices rise on stronger China outlook

Oil prices rise on stronger China outlook

Oil prices jumped over $88 a barrel on Monday, extending last week’s gains, on the strength of a better prognosis due to a predicted economic recovery in top oil importer China this year.

Brent crude was up 42 cents, or 0.48%, to $88.05, while West Texas Intermediate (WTI) U.S. crude was up 33 cents, or 0.4%, to $81.97 a barrel.

Brent jumped 2.8% last week, while the US benchmark rose 1.8%.

Due to the Lunar New Year vacation, Asian trading was slower, but analysts believe that optimism over China’s reopening will drive up oil prices.

Fatih Birol, the chairman of the International Energy Agency, warned on Friday that if the Chinese economy recovers as expected by financial institutions, energy markets could tighten this year.

“I wouldn’t be too relaxed about the markets, and 2023 may well be a year where we see tighter markets than some colleagues may think,”” Birol told Reuters on the sidelines of the World Economic Forum annual meeting in Davos.

The increase in travel in China before of the Lunar New Year holiday bodes well for petroleum demand following the two-week vacation.

The European Union and the Group of Seven (G7) alliance will control Russian refined product prices beginning February 5, in addition to the price cap on Russian crude in effect since December and an EU embargo on Russian crude imports by sea.

The G7 has agreed to postpone a review of the level of the Russian oil price ceiling until March, a month later than anticipated, to allow time to analyze the impact of the oil products price cap.

 

Source: Energy Ghana

 

ENERGY GHANA MAGAZINE

Subscribe

Connect with on Facebook