The price of a barrel of oil declined globally during trading today, Monday, January 23 (2023), amid limited trading due to the Lunar New Year holiday in East Asia.
And oil markets maintained most of the gains achieved in the past week due to the prospects for an economic recovery in China, the largest oil importer this year.
The global price of a barrel of oil today
By 07:59 a.m. GMT (10:59 a.m. Mecca time), the prices of benchmark Brent crude futures – for delivery in March 2023 – fell by 0.49%, to $87.20 a barrel.
The price of US West Texas crude futures – delivery in March 2023 – increased by 0.48%, to $81.25 a barrel, according to data seen by the specialized energy platform.
Oil prices ended their dealings, on Friday, January 20, at an increase. The global price of a barrel of oil rose by more than 1.5%, at the end of today’s trading, Friday, January 20, 2023, to reap weekly gains for the second time in a row.
Both crudes (Brent and West Texas Intermediate) achieved weekly gains of about 2.7% and 1.8%, respectively, during the past week.
Oil market conditions
Analysts said that optimism about China’s reopening is likely to push the global oil price higher.
Mumbai-based director of Trifecta Energy Consultancy Sukrit Vijikar said the market wanted to hold long positions in case Chinese growth resumed.
Commodities analysts at ANZ said in a note that the data shows a strong recovery in travel in China after the easing of coronavirus restrictions, noting a 22% jump in road traffic congestion so far this month compared to a year earlier.-
International Energy Agency chief Fatih Birol said on Friday that energy markets could tighten this year if China’s economy recovers in the way financial institutions expect it to.--
“I wouldn’t be too relaxed about markets, and 2023 could be a year where we’ll see tougher markets than some colleagues might think,” Birol said on the sidelines of the World Economic Forum’s annual meeting in Davos, Reuters reported.
The jump in traffic in China ahead of the Lunar New Year holiday bodes well for fuel demand after a two-week holiday.
Russian oil products
“The expected increase in demand comes as the market prepares for further sanctions on Russian oil,” said ANZ analysts.
The EU-G7 alliance will cap prices for Russian refined products from February 5, in addition to the Russian crude price caps in place since December and the EU’s ban on Russian crude imports by sea.
The G-7 agreed to postpone the review of the Russian oil price ceiling to March, a month later than originally planned, to give time to assess the impact of the ceiling on oil products.
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