Oil prices increased on Wednesday over statements on the ability of the world’s second-largest economy, China, to sustain its economic growth and on projections of a larger-than-expected US inventory fall, although the surge in coronavirus disease 2019 (Covid-19) Omicron variant cases continues to curtail further price rises.
International benchmark Brent crude was trading at USD74 per barrel at 0730 GMT for a 0.03-percent increase after closing the previous session at USD73.98 a barrel.
American benchmark West Texas Intermediate (WTI) was at USD71.35 per barrel at the same time for a 0.32 percent gain after trade ended at USD71.12 a barrel in the previous session.
The Chinese government will step up government spending, strengthen support for manufacturers and small companies, and ensure price stability, the deputy head of the National Development and Reform Commission, China’s economic planning body, Ning Jizhe, confirmed in an interview with Xinhua on Wednesday.
The world’s biggest oil importer is preparing for next year’s economic plan in advance to “strive to stabilize economic operations in the first quarter, the first half and even the whole year”, Ning told Xinhua.
Supporting higher prices, the American Petroleum Institute announced late Tuesday its estimate of a fall of 3.67 million barrels of US crude oil inventories, far exceeding the market expectation of a 2.63-million-barrel drop.
Investors are now awaiting the inventory data from the Energy Information Administration due later on Wednesday.
However, market concerns of lower global oil demand have been raised with the surge in Covid-19 Omicron variant cases and the potential adoption of more restrictive measures.
More countries are now considering increasing virus-related restrictions to reduce the burden on healthcare systems in the face of record numbers of cases.
However, British Prime Minister Boris Johnson said no new restrictions would be introduced before Christmas, but he did not rule out taking steps afterward.
In Australia, Prime Minister Scott Morrison on Wednesday ruled out lockdowns but instead urged the uptake of booster shots.
Source: Philippines News Agency