Singapore, April 18 (BNA): Oil prices stabilized slightly early Tuesday, after falling 2% in the previous session, as strong economic data from China, the world’s largest crude importer, boosted demand expectations.
Brent crude rose 23 cents to $84.99 a barrel at 0416 GMT, while US West Texas Intermediate crude rose 21 cents to $81.04 a barrel.
China’s economy grew at a faster pace in the first quarter, official data showed, expanding 4.5% year-on-year as policymakers moved to boost growth after tough COVID-19 restrictions ended in December, according to Reuters.
“The remarkable recovery of the Chinese economy has supported the recent recovery in oil prices,” said Leon Li, analyst at CMC Markets.
Moreover, May is the peak monsoon travel period in China and fuel demand is expected to register a very large year-on-year increase.
Chinese refinery productivity jumped to record levels in March, pointing to strong demand for fuel, as refiners ramped up operations to meet strong export demand and build inventories ahead of planned maintenance.
The International Energy Agency (IEA) predicted that China will account for most of the demand growth for crude oil in 2023.
National Australia Bank analysts said in a note to clients that oil prices also remain under pressure due to a stronger dollar and higher Treasury yields.
Data from the Energy Information Administration showed on Monday that U.S. production of crude oil and natural gas in the seven largest shale basins is expected to rise in May to an all-time high, pointing to some oversupply on that front.
“The oil market will soon have to deal with recession fears but for now it should be a volatile trade,” Edward Moya, chief market analyst at OANDA, said in a note to clients.
WWA