NEW YORK, January 11 (Reuters) – Oil prices rose 3% to a one-week high on Wednesday on hopes of an improving global economic outlook and concerns about the impact of sanctions on the global economy. with Russian crude production outpacing the large unexpected increase in US crude stockpiles .
Brent oil futures rose $2.57, or 3.2%, to $82.67 a barrel. U.S. West Texas Intermediate (WTI) crude rose $2.29, or 3.1%, to $77.41.
Both benchmarks are at their highest levels since December 30, with WTI rising for a fifth consecutive day for the first time since October and Brent oil rising for a third consecutive day for the first time since December.
Global stocks rose on hopes that Thursday’s US earnings and inflation data will show a resilient economy and lead to a slower pace of rate hikes.
If inflation falls below expectations, that will drive the dollar down, which could boost oil demand as it makes crude cheaper for buyers to hold, analysts said. other currencies.
The Federal Reserve will likely raise its target interest rate for the last time on January 31-February 31. HSBC said in a monetary policy meeting January 1, raising it by 50 basis points ( bps) to a range of 4.75% -5.00%.
Much of the market’s optimism has been attributed to top oil importer China reopening its economy following the end of strict COVID-19 restrictions.
“Energy traders should get used to higher oil prices,” said Edward Moya, senior market analyst at data and analytics firm OANDA. Expectations are high that Chinese demand is about to skyrocket.”
China’s total passenger car sales are estimated to grow 5% by 2023, Volkswagen AG China President Ralf Brandstaetter told Chinese media.
The Ministry of Industry and Information Technology (MIIT) said that China’s industrial output is expected to increase by 3.6% in 2022 from the previous year, despite production and logistics disruptions caused by COVID-19 restrictions.
The U.S. Energy Information Administration (EIA) said crude inventories rose by 19.0 million barrels last week, the third-largest weekly gain ever and the highest since inventories rose on record. 21.6 million barrels in February 2021. Last week’s increase was due to a slowdown in refinery operations. restore production after a cold-freeze shutdown at the end of 2022.
Analysts polled by Reuters had forecast a 2.2 million-barrel drop in crude inventories, and industry data from the American Petroleum Institute (API) showed an increase of 14.9 million barrels. ,
The EIA this week forecasts that US crude oil production will reach all-time highs in 2023 and 2024.
An international price ceiling imposed on Russia’s crude oil sales goes into effect on December 5, and more curbs on product sales go into effect next month when the European Union comes into effect. The European Union (EU) continues to implement additional sanctions against Moscow over its invasion of Ukraine.
The EIA said that the EU’s upcoming ban on the import of petroleum products from Russia by sea on February 5 could be more disruptive than the EU’s ban on imports of crude oil from Russia by sea. to be implemented in December 2022.
Russian Deputy Prime Minister Alexander Novak said the country’s oil producers had no difficulty securing export contracts despite Western sanctions and price ceilings.
Additional reporting by Noah Browning in London, Sonali Paul in Melbourne, Trixie Yap in Singapore and Laila Kearney in New York; Editing by Marguerita Choy, David Goodman and David Gregorio
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