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October 13, 2020

Oil prices rise as Chinese trade data offsets concerns over supply

Oil prices have edged up after drawing support from strong Chinese trade data.

By Himaja Ganta

Oil prices have edged-up after drawing support from strong Chinese trade data.

However, concerns about supply resumption in Norway, the US Gulf of Mexico and Libya restricted further gains.

Brent LCOc1 futures rose $0.12 or 0.29% to reach $41.84 a barrel, while US West Texas Intermediate (WTI) crude CLc1 futures increased by $0.12 or 0.29%, touching $39.55 a barrel, Reuters reported.

Last month, world’s biggest crude oil importer China took in 11.8 million barrels per day (Mbpd) of oil. The value is up 5.5% from 11.18 Mbpd in August and 17.5% from 10.04 Mbpd in September 2019, according to customs data.

Meanwhile, workers have been returning to the Gulf of Mexico platforms after Hurricane Delta and Norwegian staff to offshore rigs after ending a labour strike.

Production of Organization of the Petroleum Exporting Countries member Libya lifted force majeure at the Sharara field on 11 October.

On 12 October, Libya’s total output was 355,000 bpd.

Commonwealth Bank commodities analyst Vivek Dhar said: “That would effectively add 0.3% of global oil supply in a very short time frame.”

In its newly released annual World Energy Outlook, the International Energy Agency (IEA) said that ‘in its median scenario a vaccine and therapeutics could mean the global economy rebounds in 2021 and energy demand recovers by 2023’.

Furthermore, fuel demand raised more concerns as lockdown restrictions were being tightened in the UK and the Czech Republic to fight the rising infections of Covid-19.

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