Muscat: Oil prices extended early gains, rising nearly one percent on Wednesday, driven by optimism that the easing of stringent Covid-19 restrictions in China will lead to the recovery in fuel demand in the world's largest oil importer.
Oman crude has been trading above $80 per barrel since January 13.
On Wednesday (January 18), it was traded for $84.4 per barrel, while on Tuesday it was for $82.4 per barrel (January 17), $81.91 per barrel on January 16 (Monday), and $80.09 on January 13.
The 2022 GDP data from China showed that China’s economy expanded by 3 percent, which, although undoubtedly a positive figure, was taken by some to be bad news because it was the weakest GDP figure in almost 50 years, according to Reuters.
Brent crude was up soon after the release of the data, and West Texas Intermediate was down, both modestly, with more pronounced changes possible later in the day.
The 2022 GDP growth figure was substantially lower than what the Chinese government had aimed for, at 5.5 percent, but expectations are that the growth engine of Asia will stage a recovery this year.
The growth figure for the last quarter of last year reinforced these expectations. Although modest, at 2.9 percent, fourth-quarter growth topped expectations, which pegged it at 1.6 percent because of Beijing’s zero-Covid policy, which hobbled economic activity throughout the year.
“The Chinese economy is at a pivotal point, with disruptions from the protracted zero-Covid policy and its abrupt reversal likely to give way to a resurgence of at least moderate growth by Chinese standards,” Eswar Prasad, an expert on China finance from Cornell University, told the FT.ices moved in different directions today after the announcement of 2022 GDP data from China, eagerly awaited by the oil market.
The data showed that China’s economy expanded by 3 percent, which, although undoubtedly a positive figure, was taken by some to be bad news because it was the weakest GDP figure in almost 50 years, according to Reuters.
Brent crude was up soon after the release of the data, and West Texas Intermediate was down, both modestly, with more pronounced changes possible later in the day.
The 2022 GDP growth figure was substantially lower than what the Chinese government had aimed for, at 5.5 percent, but expectations are that the growth engine of Asia will stage a recovery this year.
The growth figure for the last quarter of last year reinforced these expectations. Although modest, at 2.9 percent, fourth-quarter growth topped expectations, which pegged it at 1.6 percent because of Beijing’s zero-Covid policy, which hobbled economic activity throughout the year.
“The Chinese economy is at a pivotal point, with disruptions from the protracted zero-Covid policy and its abrupt reversal likely to give way to a resurgence of at least moderate growth by Chinese standards,” Eswar Prasad, an expert on China finance from Cornell University, told the FT.
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