Early on Thursday in Asian trading, oil prices remained broadly constant as investors balanced the prospect of future interest rate increases from central banks around the world against optimism about the outlook for Chinese demand. Brent crude futures were up 1 cent, trading at $82.71 a barrel, while U.S. crude futures were down 4 cents, trading at $77.24.
The International Energy Agency’s predictions that Chinese oil demand will increase next year after declining by 400,000 bpd in 2022 helped to support the market. The forecast for the increase in global oil demand for 2023 was increased by the EIA to 101.6 million bpd, or 1.7 million bpd. According to research, China’s air and road traffic has substantially increased over the past month.
The Keystone Pipeline, owned by TC Energy Corp., which typically transports 620,000 barrels of Canadian crude per day to the United States, has been offline, which has helped to maintain oil prices. According to officials, it will take at least a few weeks to clean up the leak that triggered the outage.
The U.S. Federal Reserve reduced the 75-basis-point increases it had made at its previous four policy meetings in favour of a 50-basis-point increase in its benchmark overnight interest rate on Wednesday. The central bank gave a warning that additional interest rate increases should be anticipated. Stockpiles of U.S. crude oil increased by almost 10 million barrels last week, the largest since March 2021, because to releases from the Strategic Petroleum Reserve and decreased activity at refineries.