- Oil hits a two-week high amid expectations of a rebound in Chinese demand
- Feb ’23 WTI gains nearly 40c this morning to trade above $80/Bbl
- China's economy grew 3% in 2022, exceeding some forecasts but still well below China’s official target of 5.5% for the year
- China's National Bureau of Statistics (NBS) reported slightly higher than expected GDP growth of 2.9% during 4Q22
- The continued growth came despite COVID-zero policies and lockdowns dampening demand
- Aside from China, the growing expectation that the Federal Reserve is about to slow its aggressive streak of interest-rate hikes has supported oil prices
- However, crude prices were pressured by a slight strengthening of the dollar from seven-month lows, making dollar-denominated oil more expensive for buyers holding foreign currencies
- OPEC says Chinese oil demand is expected to rebound in 2023 by 0.5 MMBbl/d (BBG)
- OPEC left its estimate of 2022 demand growth unchanged at 2.5 MMBbl/d. The outlook for 2023 was also unchanged at a growth of 2.2 MMBbl/d, with global oil demand expected to reach 101.8 MMBbl/d
- Additionally, OPEC Secretary General Al-Ghais expressed optimism about the crude market in an interview with Bloomberg today, saying he is "seeing signs of green" in the global economy and expects China's demand to increase by 0.5 MMBbl/d this year
- The report further added that minor upward adjustments to the 2023 forecast were made due to the expected better performance in China’s economy on the back of its reopening from COVID-19 restrictions, while other regions are expected to see slight declines due to economic challenges that are likely to weigh on oil demand