Oil prices rise amid increased demand in Asia
2023.01.26 09:18
Oil prices rise amid increased demand in Asia
By Ray Johnson
Budrigannews.com – On Thursday, oil prices increased by 1% on news that inventories had increased less than anticipated and that demand would rise as China, the world’s largest oil importer, reopened its economy.
By 10:46 GMT, futures were up 78 cents, or 0.9%, to $86.90 a barrel. The price of U.S. West Texas Intermediate (WTI) crude futures was $80.90, an increase of 75 cents, or 0.9%.
Giovanni Staunovo, an analyst at UBS, stated:
“China’s reopening is supporting demand prospects.”
“Also, participants in the market are keeping a close eye on the upcoming OPEC+ JMMC meeting and the EU embargo on refined products.”
This month, Beijing reopened its borders for the first time in three years, easing severe COVID-19 restrictions.
According to MUFG analyst Ehsan Khoman, “(Commodity) markets are set to tighten significantly if the reopening in China – the world’s largest driver of commodity demand – is orderly.” Additionally, “we anticipate conditions to be ripe for commodity investor inflows.”
The Energy Information Administration (EIA) reported that U.S. crude inventories increased by 533,000 barrels to 448.5 million barrels during the week ending January 20.
Even though crude stocks are at their highest level since June 2021, according to the EIA, that was less than the 1 million barrel increase predicted.
According to OPEC+ sources, the current output levels of the oil producer group are likely to be approved at the ministerial panel meeting on February 1.
A survey of economists conducted by Budrigannews revealed that global economic growth is only expected to barely exceed 2% this year, indicating the possibility of a further downgrade. Since the start of the year, this was in contrast to the widespread optimism in the markets.
