LONDON (Reuters) – Oil prices stabilized on Monday, near $100 a barrel, as a weak dollar and a recovery in Chinese crude imports were supported by renewed demand concerns linked to China’s tough approach to containing the coronavirus.
Brent crude futures were down 1 cent, or 0.1 percent, at $98.56 a barrel at 1444 GMT. US West Texas Intermediate crude rose 4 cents, or 0.04%, to $92.65.
Both contracts fell more than $1 a barrel earlier in the session after Chinese health officials over the weekend reiterated their commitment to strict COVID containment measures, dashing hopes of a rebound in oil demand from the world’s largest importer of crude.
Brent and West Texas Intermediate rose last week, up 2.9% and 5.4% respectively amid speculation about a possible end to the COVID-19 lockdowns although there were no changes announced.
Giovanni Stonovo, an analyst at UBS, said prices pared gains amid strong risk sentiment, news of a recovery in Chinese crude imports and a weaker US dollar against other currencies.
Both contracts are still well above $90 a barrel, with Brent hovering near $100.
The US dollar fell against the Euro on Monday and the British pound was supported by risk sentiment and a rally in European stock markets.
And while China’s imports and exports contracted unexpectedly in October, its imports of crude oil rebounded to the highest level since May.
Oil prices were also boosted by expectations of tighter supplies when the European Union’s ban on seaborne Russian crude exports came into effect on December 5, although refineries around the world are ramping up production.
This quarter, US oil refineries will operate their plants at dizzying rates, near or above 90% of their capacity. Meanwhile, Zhejiang Petroleum and Chemical Co (ZPC), the largest private refiner in China, is increasing diesel production.
The Kuwait Integrated Petroleum Industries Company (Quebec) said today, Sunday, that the first phase of the Al-Zour Refinery has started its commercial operations, the official Kuwait News Agency reported.
(Reporting by Rowena Edwards) Additional reporting by Florence Tan and Mohi Narayan. Editing by David Goodman and Mark Potter
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