Oil prices steady ahead of a demand boost from China

28 Dec 2022 , 10:39 AM

As China continues to ease COVID-19 restrictions, Oil prices in the Wednesday session rose as markets hints optimistic fuel demand recovery.

Brent futures for February delivery were up 31 cents, or 0.4%, to $84.64 per barrel by 0117 GMT. Crude oil in the United States rose 22 cents, or 0.3%, to $79.75 per barrel. On Tuesday, both benchmarks reached their highest level in three weeks amid an upbeat market mood.

The hopes for an increase in fuel demand in China come as the world’s second-largest economy prepares to reopen its borders next month after three years of strict restrictions on movement and business to combat the spread of COVID.

The news that Russia aims to ban oil sales from Feb 1 also lent some cushioning to the prices. This ban shall be applicable to countries that abide by G7 price cap imposed on Dec 5.

Meanwhile, crude oil stocks in the United States are expected to fall by 1.6 million barrels, with distillate inventories also expected to fall, as per a preliminary Reuters poll released on Monday.

Elsewhere, an Arctic blast has caused temperatures to drop well below freezing, halting oil and gas production in North Dakota and Texas

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