Crude oil prices remained mixed on Friday over demand concerns, despite maintaining the highest level since early November.
As of 1335 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.12 (+0.14 percent) to reach $84.59 a barrel, its highest settlement since early November. On the other hand, the US WTI price reached $82 a barrel, down by $0.12 (-0.15 percent), which has been its highest price since mid-November.
The price for Opec Basket was recorded at $84.35 a barrel with a gain of 2.70 percent, Arab Light was available at $84.24 a barrel with an increase of 0.31 percent and the price of Russian Sokol jumped to $86.49 a barrel with an increase of 0.19 percent.
The world’s second-biggest oil consumer, China, has suspended some international flights and stepped up efforts to curb the coronavirus cases at Tianjin where cases are at peak.
Many Chinese cities have also urged people to stay put during the Lunar New Year holiday, which could cool demand for transport fuel during a peak travel season. The world’s top oil importer also posted in 2021 its first annual decline in crude oil shipments in two decades.
Meanwhile, the US Energy Information Administration (EIA) said in its Short-Term Energy Outlook (STEO) for January that global inventory builds due to supply growth outpacing demand increases will pressure oil prices down this year and the next year.
According to the STEO, Brent prices, which averaged $79 a barrel in the fourth quarter of 2021, are set to average $75 per barrel during 2022 and $68 a barrel in 2023. Similarly, WTI prices are expected to average $71.32 per barrel this year and $63.50 a barrel next year, the EIA said.
According to EIA’s estimates, inventory withdrawals globally averaged 1.4 million barrels per day (bpd) last year, thanks to faster demand growth than supply increases. This year, however, demand growth is set to slow while supply will grow faster, leading to builds in global petroleum inventories.