- Oil prices extend gains this morning
- WTI rose by nearly 1.5% to trade around $86/Bbl as Chinese demand uncertainties persist
- Despite an increase in Covid cases in Beijing, China is reportedly considering reducing the mandatory quarantine period for travelers coming to the country
- China’s strict Covid-zero policy continues to weigh on crude demand as new Covid cases touched their highest level in four months
- China's oil purchases have been modest in the most recent trading cycle, indicating that the much-anticipated increase in demand may not materialize this year (BBG)
- Despite refiners being given new permits to export more fuels, traders said that there hadn't been a discernible increase in spot purchases by major Chinese buyers for oil that might arrive in the nation by the end of 2022
- They added that state refiners are still determining how much of the additional quota they will use and may not use it all by the end of the year
- Prior to the winter, refiners warned against excessively depleting their fuel supplies, particularly diesel
- President Biden confirmed yesterday that 15 MMBbl of crude will be released from the SPR to curb gas prices, with the possibility of "further releases in the months ahead if needed"
- It will be the final installment of the 180 MMBbl release that was first announced in May
- He added that the administration would start buying back oil when WTI reaches $70/Bbl in order to replenish the SPR
- Additionally, Biden asked U.S. producers and refiners to use earnings to invest in boosting output rather than returns to shareholders and urged Congress to approve legislation to change federal permitting laws that will speed up energy infrastructure projects