Oil prices experience significant increase as China’s crude imports show positive growth and Chinese New Year travel boosts demand

Asian oil prices experienced a dip on Monday, however, they are still holding strong near their highest level of the year. This is due to the anticipation of a surge in fuel demand as China reopens its economy, solidifying its position as the world’s top crude importer. The market is eagerly watching to see if this will be a temporary setback or a sign of a larger shift in the industry.

  • Brent crude fell 36 cents, or 0.4%, to $84.92 a barrel.
  • WTI crude was at $79.65 a barrel, down 21 cents, or 0.3%.

Oil contracts saw a spectacular rise last week, with both contracts surging by more than 8%, the biggest weekly increase in months.

This can be attributed to China’s crude imports showing positive signs of recovery, with a 4% year-on-year increase in December, coupled with the anticipation of increased transportation fuel demand during the festive season of Chinese New Year. Experts predict that this is just the tip of the iceberg, as the lifting of restrictions due to COVID-19 leads to a resurgence in domestic demand. This has already resulted in a sharp decline of 40% in China’s exports of refined oil products in January, particularly in gasoline.

As the week progresses, the market is eagerly awaiting the monthly report from the Organization of the Petroleum Exporting Countries and the International Energy Agency to gauge the direction of global supply and demand trends.

Additionally, the outcome of the Bank of Japan’s (BOJ) crucial meeting will also be watched with bated breath as it could potentially determine the fate of the country’s economic stimulus policy.

The Spot Market is Open

Monday, January 16, 2023

Energy
Updated at
USD
Price

Change

%Change
Crude Oil
12.20

79.32

-0.54

-0.68%

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