Oil prices rose significantly again on Friday morning. A 159-liter barrel of North Sea Brent cost $96.55 for January delivery. That was $1.92 more than the previous day. The price of US West Texas Medium (WTI) grade barrels for December delivery increased by $1.94 to $90.11.
The increase was due to speculation that China might finally loosen its restrictive corona policy. This has fueled hopes for higher demand from the country of 1.4 billion people. There had already been speculation throughout the week about a possible departure from the leadership’s strict zero-Covid strategy in Beijing, which had been rejected by the Chinese authorities. Despite the rejection, investors in the oil market are apparently still counting on an imminent easing that pushes prices up.
Various price drivers
Analysts at Bank of China assume that oil demand in China has dropped by an average of 400,000 barrels per day this year as a result of the tough corona policy.
The demand of the billionaire state is just one of the factors affecting oil prices. In addition to oil quality, these are primarily financial market factors such as exchange rates and economic prospects. When the dollar rises, this usually curbs demand. Since its low last September, the price of oil (Brent and WTI) has again tended to rise significantly in recent weeks. (SDA/rae)