WTI Oil Close Down 2 Cents as Investors Take Profits After Price Surge

Crude oil futures closed lower on Monday, January 23rd, as investors took profits after the West Texas Intermediate (WTI) oil contract hit a 7-week high during the day.

  • WTI crude futures were down 2 cents, or 0.02%, at $81.62 a barrel, while
  • Brent crude futures rose 56 cents, or 0.64%, to settle at $88.19 a barrel.

According to Phil Fine, an analyst at Price Futures Group, WTI initially rose to $82.64, its highest since December, before closing in negative territory. The strong rally during the day came from hopes that China’s opening up would boost economic activity and demand for oil.

Analysts from ANZ said China’s domestic travel has increased dramatically since the government eased restrictions on COVID-19. Road traffic in 15 major cities was 22% more congested compared to the same period last year, indicating an increase in oil demand in China, the world’s largest oil importer.

The International Energy Agency (IEA) also stated that the energy market will face tighter conditions this year due to the increase in demand from China opening up the country, and declining supply as Russia faces sanctions from the United States and the West.

The IEA expects Russian oil production to drop 14% to 9.6 million barrels per day by the end of the first quarter of 2023, and global oil demand is expected to grow by 1.7 million barrels per day in 2023 to 101.6 million barrels per day, supported by demand for oil from China and India.

Investors are now waiting for the weekly US crude inventories report, set to be released by the US Energy Information Administration (EIA) on Wednesday.

The Spot Market is Open

Tuesday, January 24, 2023

Energy
Updated at
USD
Price

Change

%Change
Crude Oil
10.10

81.77

+0.15

+0.18%

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