West Texas Intermediate (WTI) crude oil futures in New York closed higher on Monday (January 9), supported by expectations that China’s opening will boost oil demand.
The WTI crude oil contract will be introduced in February. They were up 86 cents, or 1.2%, at $74.63 a barrel.
The Brent crude oil contract (BRENT) will be introduced in March. It was up $1.08, or 1.4%, at $79.65/barrel.
The Chinese authorities began opening the country in and out since Sunday, January 8th. This marked the end of China’s long-standing zero-covid policy to contain the spread of COVID-19. China is expected to open up the country to make up to 2 billion trips during the Chinese New Year. This had almost doubled since last year and accounted for 70% of all travel in 2019.
The market is also supported After the Federal Reserve of the United States (Fed), New York branch, released the results of the monthly survey in December. US consumer inflation expectations continue to decline.
Consumers expect inflation to reach 5.0 per cent over the next year, the lowest level since July 2021. and below the level of 5.2% surveyed in November. Meanwhile, consumers expect inflation for the next three years at 3.0% and for the next five years at 2.4%.
In addition, the market has also benefited from the weakening of the dollar. The dollar index, which measures the greenback against a basket of six major currencies, was down 0.85 percent at 103.0010 overnight, with the greenback weakening dollar-priced crude futures. It is cheaper and more attractive to investors who hold other currencies.
