Oil rose more than $1 a barrel on Monday, rebounding after a decline in the previous session, as optimism over the Chinese economy and a recovery in fuel demand outweighed concern over a global recession.
China, the world’s top crude oil importer, is experiencing its first of three expected waves of COVID-19 cases after Beijing relaxed mobility restrictions but said it plans to step up support for the economy in 2023.
“There is no doubt that demand is being adversely influenced,” said Naeem Aslam, analyst at brokerage Avatrade.
“However, not everything is so negative as China has vowed to fight all pessimism about its economy, and it will do what it takes to boost economic growth.”
Brent crude gained $1.12, or 1.4%, to $80.16 a barrel by 1440 GMT while U.S. West Texas Intermediate crude rose $1.42, or 1.9%, to $75.71.
Oil surged towards its record high of $147 a barrel earlier in the year after Russia invaded Ukraine in February. It has since unwound most of this year’s gains as supply concerns were edged out by recession fears, which remain a drag on prices.
The U.S. Federal Reserve and European Central Bank raised interest rates last week and promised more. The Bank of Japan, meanwhile, could shift its ultra-dovish stance when it meets on Monday and Tuesday.
“The prospect of further rate rises will hit economic growth in the new year and in doing so curb demand for oil,” said Stephen Brennock of oil broker PVM.
Oil was supported by the U.S. Energy Department saying on Friday that it will begin repurchasing crude for the Strategic Petroleum Reserve – the first purchases since releasing a record 180 million barrels from the reserve this year.
For all the latest Business News Click Here
For the latest news and updates, follow us on Google News.
Denial of responsibility! NewsBit.us is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.
