© Reuters. FILE PHOTO: The sun sets behind a crude oil pump jack on a rig in the Permian Basin in Loving County, Texas, U.S. November 24, 2019. REUTERS/Angus Mordant
By Isabel Kua
SINGAPORE (Reuters) – Oil prices were little changed on Wednesday as a more-than-expected drop in inventories offset concerns about rising COVID-19 infections at top oil importer China.
Futures contracts rose 8 cents, or 0.1%, to $80.07 a barrel by 07:15 GMT, while U.S. West Texas Intermediate (WTI) crude oil futures fell 1 cent down to 76.22 USD.
U.S. crude inventories fell by about 3.1 million barrels in the week to December 16, according to market sources citing data from the American Petroleum Institute, while nine analysts polled by Reuters estimated inventories fell by 1.7 million barrels.
Gasoline stocks rose by about 4.5 million barrels, while distillate stocks rose by 828,000 barrels, according to unnamed sources.
“A larger-than-expected drop in US inventories, coupled with US plans to replenish the Strategic Petroleum Reserve, have supported oil prices,” said Serena Huang, head of APAC analysis at Vortexa.
“But optimism has been capped by downward pressure from growing global economic headwinds and the recent increase in China’s COVID cases,” Huang added.
Meanwhile, Saudi Energy Minister Prince Abdulaziz bin Salman said in an interview with Saudi state news agency that OPEC+ members do not bring politics out. from their decision-making processes as well as their evaluations and forecasts.
The minister added that OPEC+’s decision to cut oil production, which was heavily criticized, turned out to be the right decision to support market and industry stability.
CMC Markets analyst Tina Teng said oil prices were boosted by these comments suggesting OPEC+ may continue to tighten supply to support oil prices.
Growing worries about a rise in COVID-19 cases in China as the country begins to lift its strict no-COVID policy has kept oil prices from moving higher.
The country’s approach has kept the number of infections and deaths relatively low among its 1.4 billion population, but the World Health Organization has called it “unsustainable” this year due to concerns about the impact. its impact on the lives of the people and the economy of the nation.
China’s crude oil imports from Russia in November rose 17% from a year earlier, as Chinese refiners rushed to secure more goods ahead of price ceilings imposed by the Group of Seven. booked on December 5.
This increase makes Russia the top oil supplier to China, surpassing Saudi Arabia.