Oil prices consolidated their gains today, Monday, as they rose by more than 3.2%, after China opened its borders This supported expectations of fuel demand and balanced fears of a global recession.
The recovery came as part of a broader increase in risk appetite, supported by the actions of China, the largest importer of crude oil in the world, and hopes to slow the pace of raising interest rates in the United States, with the rise of stocks and the decline of the dollar.
Brent crude futures rose $ 2.5, or 3.23%, to $ 81.14 a barrel by 15:15 GMT, while US West Texas Intermediate crude recorded $ 76.35 a barrel, up $ 2.58, or 3.51%.
“If a recession is avoided, global oil demand growth will remain resilient,” said Tamas Varga of oil brokerage PVM, adding that developments in China were the main reason for Monday’s gains.
“The gradual reopening of the Chinese economy will provide an infinite additional layer of price support,” he added.
The recovery came after a drop last week of more than 8% in the prices of the two benchmarks, in their largest weekly decline at the beginning of a new year since 2016.
As part of a “new phase” of the war against COVID-19, China opened its borders over the weekend for the first time in 3 years. The number is expected to arrive Trips Domestically to two billion trips during the Lunar New Year season, nearly double last year’s traffic, restoring 70% of 2019 levels, Beijing says.
Despite the recovery in oil prices today, Monday, there are still fears that this massive influx of travelers will lead to a further increase in Covid-19 infections, while economic concerns remain on the horizon.