Oil up as robust China trade data offsets returning supply

By Ahmad Ghaddar

LONDON (Reuters) – Oil prices rebounded on Tuesday as robust China data offset returning supply in Norway, the Gulf of Mexico and Libya.

Brent crude <LCOc1> futures rose 63 cents, or 1.5%, to $42.35 a barrel by 1224 GMT. U.S. West Texas Intermediate (WTI) crude <CLc1> futures rose 71 cents, or 1.8%, to $40.14 a barrel.

China, the world’s top crude oil importer, took in 11.8 million barrels per day (bpd) of oil in September, up 5.5% from August and up 17.5% from a year earlier, customs data showed.

“Currently, oil demand is driven primarily by China,” Commerzbank said.

The International Energy Agency (IEA) – which advises Western governments on energy policy – said in its World Energy Outlook that in its central scenario a vaccine and therapeutics could mean the global economy rebounds in 2021 and energy demand recovers by 2023.

But under a “delayed recovery scenario”, it said the energy demand recovery is pushed back to 2025.

“The era of global oil demand growth will come to an end within the next 10 years, but in the absence in a large shift in government policies, I don’t see a clear sign of a peak,” IEA chief Fatih Birol told Reuters.

Lockdown measures were being tightened in Britain and the Czech Republic to battle rising cases of COVID-19, and French Prime Minister Jean Castex said he could not rule out local lockdowns.

On the supply side, workers have been returning to U.S. Gulf of Mexico platforms after Hurricane Delta and Norwegian workers to offshore rigs after ending a strike.

OPEC member Libya on Sunday also lifted force majeure at its Sharara oilfield.

Libya’s total output on Monday was expected to hit 355,000 bpd while a full return of the 300,000 bpd Sharara field would nearly double that.

(Additional reporting by Sonali Paul and Shu Zhang; editing by Susan Fenton and Jason Neely)

Source Article