© Reuters. An oil field in Texas in a photo from the Reuters archive.
(Reuters) – Oil prices fell on Thursday as surging COVID-19 cases in China dampened hopes for a recovery in fuel demand in the world’s second-largest oil consumer.
The scale of China’s recent outbreak and skepticism about official data prompted some countries to issue new travel rules for Chinese visitors, even as Beijing has begun to criticize authorities over the world’s toughest lockdown and testing regime.
February crude futures fell 42 cents, or 0.5%, to 82.84 a barrel at 0123 GMT, while US crude fell 50 cents, or 0.6%, to 78.46 dollars a barrel.
The oil markets were also affected by expectations of a further hike in US interest rates in the United States, as the Federal Reserve seeks to limit price increases in the labor market, which suffers from scarcity.
U.S. inventories fell less-than-expected, by about 1.3 million barrels, in the week ending Dec. 23, according to market sources citing data from the American Petroleum Institute, down on analyst estimates for a draw 1.5 million. The US government will release its weekly numbers at 10:30 am EST on Thursday.
Also affecting prices, the pipeline management company (TC Energy) (TADAWUL:) said it was working to restart part of the Keystone pipeline, which authorities were forced to shut down after this month’s leak.
However, the markets got some support as Russian President Vladimir Putin banned the export of crude oil and petroleum products from February 1 for five months to countries adhering to the Western price ceiling.
Germany has said the embargo has “no practical significance” given Berlin’s work since the spring to replace Russian oil supplies and ensure security of supply.
(Prepared by Ali Khafaji for the Arab Bulletin)
