Oil prices rose on Thursday, recovering from losses incurred in early trading, thanks to hopes that the planned easing of pandemic restrictions in the Chinese city of Shanghai will improve fuel demand, while continuing concerns about a global supply shortage overshadowed concerns about slowing economic growth.
Brent crude futures for July delivery rose $1.32, or 1.2 percent, to $110.43 a barrel, after falling more than a dollar earlier in the session.
US West Texas Intermediate crude futures for June delivery rose 62 cents, or 0.6 percent, to $110.21 a barrel, recovering from an early loss of more than $2. And US crude contracts for July delivery rose 1.33 dollars, or 1.2 percent, to 108.26 dollars a barrel. The two global benchmark contracts, to the nearest maturity, fell by about 2.5 percent, on Wednesday.
“The decline in Wall Street dampened sentiment in early trade, as it underscored concerns about weak consumption and fuel demand,” said Satoru Yoshida, a commodity analyst at Rakuten Securities.
“Oil markets are still maintaining an upward trend, as an expected import ban from the European Union for Russian crude is expected to further reduce global supplies,” he added.
The European Union this month proposed a new package of sanctions against Russia, including a complete ban on Russian oil imports within six months, but it has not yet been adopted.
US crude stocks fell, last week, unexpectedly, as refineries increased production in response to the shortage of stocks, which raised diesel and gasoline prices in the United States to record levels.
In China, investors are closely watching the plans of Shanghai, the country’s most populous city, to ease anti-pandemic restrictions from June 1, which could lead to a recovery in oil demand in the world’s largest importer of crude. (Archyde.com)
Oil prices offset early losses on China hopes and supply concerns
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