Oil Rebounds as China and US Data Ease Recession Concerns

Oil Rebounds as China and US Data Ease Recession Concerns
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FILE PHOTO – An oil field worker works on a pump jack at PetroChina’s Daqing oil field in northeast China’s Heilongjiang province November 5, 2007. REUTERS/Stringer (CHINA)

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SINGAPORE, Aug 8 (Reuters) – Oil prices rebounded from multi-month lows on Monday as investor appetite improved after data on U.S. jobs and Chinese exports eased recession concerns.

Brent crude futures were up 81 cents, or 0.9%, at $95.73 a barrel by 0638 GMT. US West Texas Intermediate crude was trading at $89.76 a barrel, up 75 cents or 0.8%.

Both contracts closed higher on Friday after job growth in the United States, the world’s top oil consumer, unexpectedly accelerated in July. On Sunday, China also surprised markets with faster-than-expected export growth. read more

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Signs of weak demand in US inventories last week encouraged trading based on a weakening outlook, said Stephen Innes, managing director at SPI Asset Management. But the jobs and export data had somewhat reversed that view, he added.

Month-over-month Brent prices hit their lowest levels since February last week, falling 13.7% and posting their biggest weekly drop since April 2020, while WTI lost 9.7% as concerns by a recession affecting oil demand weighed on prices.

China, the world’s top crude importer, imported 8.79 million barrels per day (bpd) of crude in July, up from a four-year low in June but still down 9.5% from a year earlier. showed customs data.

Chinese refiners cut stocks amid high crude prices and weak domestic margins, even as the country’s overall exports gained momentum. read more

Reflecting lower US gasoline demand, and as China’s zero-COVID strategy fuels the recovery, ANZ lowered its 2022 and 2023 oil demand forecasts by 300,000 bpd and 500,000 bpd, respectively.

Oil demand for 2022 is now estimated to rise by 1.8 million bpd year-on-year and settle at 99.7 million bpd, just below pre-pandemic highs, the bank said.

Russian exports of crude oil and petroleum products continued to flow despite a looming European Union embargo set to take effect on December 1. 5. read more

In the United States, energy companies last week cut the number of oil rigs to the most since September. It was the first drop in 10 weeks.

The US clean energy sector received a boost after the Senate on Sunday approved a $430 billion bill aimed at combating climate change, among other issues. read more

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Information from Florence Tan; Edited by Gerry Doyle and Bradley Perrett

Our standards: The Thomson Reuters Trust Principles.

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