By Florence Tan
SINGAPORE (Reuters) – Oil prices were little changed in early Asian trade on Monday after leveling off at $2 a barrel on Friday, as rising supplies in the United States and forecasts of further rate hikes cooled optimism about China’s demand recovery.
Brent crude fell 9 cents, or 0.1%, to $82.91 a barrel by 0051 GMT. US West Texas Intermediate Crude for March expiring on Tuesday was at $76.40 a barrel, up 6 cents. The more active April contract fell 9 cents to $76.46.
Benchmarks closed about 4% lower last week after the United States reported higher crude oil and gasoline inventories.
Washington also announced plans to release 26 million barrels of crude from the Strategic Petroleum Reserve (SPR), which could lead to higher inventories in Cushing, Oklahoma, the delivery point for WTI contracts, by May, analysts at Energy Aspects said in a note.
Expectations that the US Federal Reserve will raise interest rates further, which could strengthen the dollar, also weighed on oil prices. A stronger greenback makes dollar-denominated oil more expensive for holders of other currencies.
As a further sign of improved supply, Kazakhstan will ship 100,000 tons of oil via Russia’s Druzhba pipeline to Germany for PCK’s Schwedt refinery in March.
In Asia, investors are watching the People’s Bank of China’s decision on its mortgage rates to help the recovery of the real estate sector and its economy, said Tina Teng, an analyst at CMC Markets. China is the world’s largest crude oil importer.
Analysts expect China’s imports to hit an all-time high in 2023 on increased demand for transportation fuel and new refineries coming online.
China, along with India, has become the top buyers of Russian crude oil following the European Union embargo.
India’s Russian oil imports hit a record 1.4 million barrels a day in January, trade data showed.
(Reporting by Florence Tan; Editing by Himani Sarkar)
Don’t miss interesting posts on Famousbio
