Analysts said recent Chinese crude purchases and a recovery in road traffic boosted confidence in demand recovery in the world’s second-largest economy after China reopened its borders and eased COVID-19 restrictions after last year’s protests.
“Given the focus on energy security, we expect Chinese imports to continue to rise, especially at a time when crude oil storage remains a strategic priority and refining activity is picking up,” RBC analyst Michael Tran said in a note to clients. .
In another encouraging sign, ANZ analysts said the congestion index, which covers the 15 Chinese cities with the largest number of car registrations, rose 31 percent from the previous week.
“Road traffic levels in China continue to recover from record low levels after the easing of COVID-19 restrictions,” they added in a note.
price movements
Brent crude futures fell 17 cents, or 0.2 percent, to $83.86 a barrel by 0119 GMT, while US West Texas Intermediate crude futures fell 12 cents, or 0.2 percent, to $78.27, according to Reuters data.
Brent has jumped 6.7 percent so far this week, and WTI has risen 6.2 percent, recouping most of the previous week’s losses.
Oil prices were also boosted by the dollar’s decline to its lowest level in nearly nine months after data showed that inflation in the United States fell for the first time in two and a half years, which reinforced expectations that the Federal Reserve will slow the pace of raising interest rates.
A weaker dollar usually increases demand for oil because it makes the commodity cheaper for buyers who hold other currencies.
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