Crude oil prices rose at a slight pace, at the end of trading today, Tuesday, April 18 (2023), with the strong economic data coming from China, which is the largest importer of oil in the world.
Official data coming from China contributed to the rise in crude oil prices, especially with faster-than-expected economic growth in Beijing during the first quarter of this year (2023), in addition to an expansion of 4.5% on an annual basis, according to what was seen by the specialized energy platform.
Crude oil prices today
At the end of the session, Brent crude futures contracts – for June 2023 delivery – rose 0.01%, or one cent, to $84.77 a barrel, after falling below $84 during trading.
At the same time, US West Texas Intermediate crude futures – for May 2023 delivery – increased by 0.04%, 3 cents, to reach $80.86 a barrel, according to figures seen by the specialized energy platform.
Crude oil prices rose, thanks to the expansion of the Chinese economy on an annual basis, by 4.5%, with policy makers in Beijing moving to boost growth, after ending the strict restrictions imposed to confront the Corona pandemic, last December 2022.
Analysts believe that prices will achieve a greater recovery in the coming months, especially with the approaching peak travel season in China, next May 2023, as fuel demand is expected to increase significantly.
The data reinforced the expectations of demand for crude oil, which contributed to achieving a price recovery, after the 2% decline in crude prices witnessed yesterday, Monday, April 17, according to Reuters.
Oil price analysis
“The remarkable recovery of the Chinese economy has supported the recent recovery in crude oil prices,” said Leon Li, an analyst at CMC Markets, explaining that fuel demand is expected to rise with the entry of the peak seasonal travel in China.
Li pointed to the high productivity of Chinese refineries to record levels in March, indicating strong demand for fuel, as refineries stepped up operations to capture strong export demand and build up stocks ahead of planned maintenance.
In turn, the International Energy Agency expected China to account for most of the growth in demand for crude oil for the year 2023, but it warned that production cuts by OPEC + countries may exacerbate the expected supply deficit in the second half of the year, and may harm consumers and hinder the global economic recovery.
Analysts at National Australia Bank also considered that oil prices are still under pressure due to the strength of the dollar and the rise in Treasury yields, especially as the dollar rises with interest rates raised, while traders are betting that the US Federal Reserve will raise interest rates again in May. Next 2023.
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