(New York) Oil prices ended up very modestly on Monday, slightly supported by the easing of health restrictions in China, which partly reassured demand.
Posted yesterday at 3:55 p.m.
A barrel of Brent North Sea oil for July delivery gained 0.77% to $113.42.
A barrel of US West Texas Intermediate (WTI) for delivery in July, which is the first day of use as a benchmark contract, gained 1 cent (+0.009%) to 110.29 dollars.
“Oil prices are on the rise, with Brent rising above WTI, as Shanghai prepares to lift its two-month embargo, alleviating concerns about weak Chinese demand,” said Victoria Scholar, analyst at Interactive Investor.
Brent type crude from the North Sea is in fact intended for a much wider geographical area than American WTI, which remains mainly consumed in the United States.
Shanghai, the economic capital of China, has been experiencing a harsh form of confinement since April, with the ban on leaving home in a large part of the city and the isolation of positive cases.
Four of the city’s 20 metro lines restarted on Sunday, as did some road transport, forming a “core network covering all central urban areas”, according to authorities.
For Matt Smith of Kpler, however, this reopening remains fragile “while concerns remain, with a rise in COVID-19 cases in Beijing”.
The analyst also noted that the dollar weakened markedly on Monday without really supporting the price of oil, which is usually the case when the American currency falls. The Dollar index, which compares the greenback to a basket of currencies, plunged 1% around 7:30 p.m. GMT.
On the side of the European Union, an agreement on the ban on Russian oil imports is still under discussion, but Hungary “is still dragging its feet”, underlined Matt Smith.
For Stephen Brennock, analyst at PVM Energy, “the terms of the embargo are still being negotiated, in a context of strong resistance from countries heavily dependent on Russian energy, in particular Hungary”.