Oil Advances as Traders Look to China, OPEC for Fresh Triggers

  • In Business
  • 2023-01-25 02:20:27Z
  • By Bloomberg

(Bloomberg) -- Oil edged higher as investors weighed the extent of China's demand recovery and the likelihood of OPEC+ keeping output unchanged.

Most Read from Bloomberg

  • US Confronts China Over Companies' Ties to Russia War Effort

  • NYSE Investigates Technical Issue That Caused Wild Market Open

  • China Slams US on Debt Limit and Accuses Washington of Sabotage

  • US and Germany Set to Send Tanks to Ukraine, Breaking Deadlock

  • Citadel's $16 Billion Win Tops Paulson's Greatest Trade Ever

West Texas Intermediate rose toward $81 a barrel after declining by almost 2% on Tuesday as mixed earnings and weaker business activity spurred concerns about a US slowdown. China's ditching of Covid Zero has boosted expectations that energy demand will eventually pick up in the largest crude importer.

Delegates from the Organization of Petroleum Exporting Countries said that they expect an advisory committee of ministers to recommend keeping oil production at current levels when they meet next week.

Crude has rebounded since collapsing about 10% in the year's first two sessions of the year on recessionary fears. The recovery has rested largely on hopes that Chinese consumption will pick up, although a weaker dollar has also aided commodities. Traders are also tracking Russian flows, with sanctions and price caps on petroleum products set to kick in next month as Europe and the US step up efforts to deprive Moscow of funds to fight its war in Ukraine.

"Oil prices are attempting to pare some losses" that followed the weak US purchasing managers index data on Tuesday, said Yeap Jun Rong, market strategist at IG Asia Pte in Singapore. "But much is still up in the air, with the muted risk environment not providing much conviction."

At present, China is midway through a week-long break to mark the Lunar New Year, when people traditionally return to their hometowns. The volume of trips has picked up, but the wave of travel may bring increased risk of Covid-19 spreading. The nation's financial markets will reopen next week.

The American Petroleum Institute reported US crude inventories rose 3.38 million barrels last week, according to people familiar with the figures. Government data - which showed commercial stockpiles swelled by more than 27 million barrels in the prior two weeks - are due later Wednesday.

Further insight into the market will come as supermajors report quarterly earnings in the coming days, starting with figures and commentary from Chevron Corp. on Friday. Amid a milder winter in Europe and lingering concerns over the economic outlook, there are expectations this set of results could be the last strong ones for the industry, marking a peak of the cycle.

Elements, Bloomberg's daily energy and commodities newsletter, is now available. Sign up here.

Most Read from Bloomberg Businessweek

  • Wind Turbines Taller Than the Statue of Liberty Are Falling Over

  • Spyware Finally Got Scary Enough to Freak Lawmakers Out-After It Spied on Them

  • Stagflation Is the Dreaded Word No One Dared Speak at Davos

  • Fake Meat Was Supposed to Save the World. It Became Just Another Fad

  • The Coyotes Working the US Side of the Border Are Often Highly Vulnerable, Too

©2023 Bloomberg L.P.


More Related News

Starbucks misses sales, revenue estimates as China falters
Starbucks misses sales, revenue estimates as China falters
  • US
  • 2023-02-02 21:35:55Z

Starbucks reported lower-than-expected sales in its fiscal first quarter, hurt by COVID restrictions in China and lower consumer demand in other markets...

Stock Bull Pain Threshold Swells to Pandemic Size in New Market Run-Up
Stock Bull Pain Threshold Swells to Pandemic Size in New Market Run-Up

(Bloomberg) -- Anyone who lived through the 2020 bull market knows: investors, especially of the retail ilk, can stomach a lot of pain. However dark is the...

Amazon Projects Lackluster Sales on Slower Cloud Unit Growth
Amazon Projects Lackluster Sales on Slower Cloud Unit Growth

(Bloomberg) -- Amazon.com Inc. projected lackluster revenue in the current quarter, worrying investors that the company's main e-commerce business has...

How the US is boosting military alliances to counter China
How the US is boosting military alliances to counter China
  • US
  • 2023-02-02 21:18:18Z

The U.S. is expanding it military presence in Asia, in a string of moves aimed at countering Beijing and reassuring Indo-Pacific allies that America will...

Meta Evokes Big Tech
Meta Evokes Big Tech's Glory Days With Biggest Surge Since 2013

(Bloomberg) -- A spectacular turnaround in Meta Platforms Inc.'s stock is bringing back flashes of Big Tech heydays.Most Read from BloombergMerck Covid Drug ...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: Business