Last Update: April 25, 2023, 01:03 AM IST
Refining margins in Asia weakened on record production from top refiners China and India, reducing the region’s appetite for Middle East supply loadings in June. (Image: Reuters file)
Last week, both contracts fell more than 5% for their first weekly decline in five as U.S. gasoline demand fell from a year ago.
Oil prices held higher on Monday, reversing losses as investors hoped holiday travel in China would boost fuel demand in the world’s biggest oil importer.
Brent crude settled down $1.07, or 1.3%, at $82.73 a barrel, while US West Texas Intermediate crude rose 89 cents, or 1.1%, at $78.76.
Last week, both contracts fell more than 5% for their first weekly decline in five as US gasoline demand fell from a year earlier.
China’s bumpy economic recovery after the COVID-19 pandemic has clouded the oil demand outlook, although Chinese customs data on Friday showed a record amount of imports in March.
Bookings in China for overseas travel during the upcoming May Day holiday point to a continued recovery in travel to Asian countries, but numbers are lower than pre-COVID numbers due to long-haul airfares rising and not enough flights available. Too far from -19 levels.
“There’s a lot of optimism around the Chinese holidays as it relates to jet fuel demand, the first real numbers on Chinese demand building,” said Bob Yoger, director of energy futures at Mizuho.
Supply tightness due to additional supply cuts planned by the OPEC+ producer group from May could also push prices higher.
“Planned production cut by OPEC+ alliance and strong demand outlook from China could boost prices in coming days,” said independent oil analyst Sugandha Sachdeva.
Iraq’s northern oil exports also showed few concrete signs of an imminent restart after a month-long pause, as aspects of an agreement between Baghdad and the Kurdistan Regional Government (KRG) have yet to be resolved, according to four sources. .
Refining margins in Asia weakened on record production from top refiners China and India, reducing the region’s appetite for Middle East supply loadings in June.
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