Oil gains as China plans to increase U.S. crude imports
Oil prices gained on Monday after news that China is planning to ship large volumes of U.S. crude in August and September. The news outweighed concerns over a demand slowdown due to the pandemic and a surge in supply.
Brent crude rose 0.7%, or 32 cents, at $45.12 per barrel. U.S West Texas Intermediate crude climbed 0.8%, or 35 cents, at $42.36 per barrel.
China state-owned oil firms are reported to have booked to transport 20 million barrels of U.S. crude for August and September. This came as China increased energy and farm purchases ahead of the U.S.-China trade deal review.
Record crude imports and the lifting of a few lockdowns globally have supported oil prices. However, the recent surge in new coronavirus cases is expected to lower consumption again.
Analysts say that oil demand rose 8 million bpd to 88 million bpd over the last four months. Meanwhile, investors are waiting for the OPEC panel meeting on Aug. 19 to get clues on future oil supply.
OPEC’s Joint Ministerial Monitoring Committee recommended easing output cuts from 9.7 million bpd to 7.7 million bpd from Aug. 1.