January 28, 2023

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Oil fall in anticipation of withdrawal from US and Chinese reserves

Oil fall in anticipation of withdrawal from US and Chinese reserves

Sources told Reuters at the end of last year that China had agreed with the United States to pull out of its strategic oil reserves in the run-up to the Lunar New Year holiday, which begins on February 1, as part of Washington’s plan to reduce world prices.
Sources familiar with the discussions between the two countries said that China agreed to withdraw unspecified amounts of oil by the end of 2021 in line with price levels.
Oil prices fell for a second consecutive session on Friday on expectations that Washington may soon move to control prices above $ 80 a barrel, while restrictions on movement in China in the wake of the Govt-19 eruption have weighed on demand. Fuel.
Brent crude was down six cents at $ 84.41 a barrel at 0427 GMT.
US West Texas Intermediate crude traded down 21 cents, or 0.3 percent, at $ 81.91 a barrel.
China, the world’s second-largest oil consumer, has stopped some international flights and intensified efforts to stem the spread of the virus in Tianjin province, while the mutated Omigran strain of the corona virus has spread to the northeastern city of Dalian.
Many cities, including Beijing, have urged residents not to travel during the lunar New Year holidays, which will reduce fuel demand during peak travel season.

China says oil imports have fallen for the first year in 20 years

In 2021, China also recorded the first annual decline in crude oil imports in 20 years.
And the U.S. Department of Energy said on Thursday that it had sold 18 million barrels of oil from strategic reserves to six companies.
Nevertheless, the two criteria, Brent and West Texas Intermediate, will continue to rise for the fourth week in a row, supported by supplies and political concerns in Libya and Kazakhstan, and the lowest possible U.S. crude oil reserves since 2018.

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China imports

China’s crude oil imports totaled 512.98 million tonnes in 2021, up from 542.39 million tonnes in the previous year, indicating an annual decline since 2001.
Imports in December stood at 46.14 million tonnes, according to Chinese customs data. (Reuters)