Oil rose significantly on Friday, despite the strengthening of the US dollar and thin market liquidity. However, oil (Brent and WTI) is preparing to record a third weekly drop in a row, by about 1%, amid worries about tight supply easing.
Economists note that currently the main impact on the price of oil is caused by concerns about demand in China (due to the increase in cases of coronavirus) and uncertainty about how serious the recession may be.
Yesterday, 32,943 new COVID-19 infections were recorded in China, the National Health Commission said. Symptoms of the disease appeared in 3,103 patients, 29,840 people are asymptomatic. Guangdong Province in southeastern China suffered the most (8,499 new cases). On November 23, 31,656 new cases of infection were detected in the country. On that day, China set a record for the number of infections.
Against the background of another outbreak of infection, the government began to introduce new restrictions. Overall, a surge in COVID-19 cases in China, the world's largest oil importer, is negatively impacting demand. ANZ analysts said that traffic drifting down and implied oil demand is around 13 million barrels per day, which is 1 million bpd lower than average.
Trading is expected to remain cautious ahead of an agreement on the russian oil price cap, due to come into effect on December 5 when an EU ban on Russian crude kicks off, and ahead of the next OPEC+ meeting.