WTI crude oil traded near $78 per barrel on Friday and were on track to gain about 6% this week, underpinned by an improving demand outlook in China and hopes for less aggressive interest rate hikes from the US Federal Reserve.
China ramped up crude purchases this week after Beijing issued new import quota, and consumption is expected to surge to a record this year following the country’s exit from its zero-Covid policy, as observed by Bloomberg.
Meanwhile, US inflation eased further in December, reinforcing expectations that the Fed will slow the pace of interest rate hikes and supporting a rally in risk assets.
Concerns about the impact of sanctions on Russian supply also lent optimism to bulls, as European Union curbs aimed at Russian fuel product sales are due to take effect in February. Elsewhere,
OPEC+ decided in December to stick with their policy of restricting global supplies by 2 million barrels per day, a move due to run through the end of 2023.P
