Investing
Oil Rebounds From Drop on China Demand Concerns
Published by Jessica Weisman-Pitts
Posted on April 26, 2022
2 min readLast updated: February 7, 2026
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Published by Jessica Weisman-Pitts
Posted on April 26, 2022
2 min readLast updated: February 7, 2026
Add as preferred source on GoogleBy Rowena Edwards
LONDON – Oil prices rebounded in volatile trading on Tuesday as the market weighed concerns over Russian supply and Chinese demand.
Brent crude futures were up $1.26 cents, or 1.2%, at $103.58 a barrel by 1355 GMT. U.S. West Texas Intermediate contracts were up $1.14 cents, or 1.2%, at $99.68.
Brent and WTI had settled about 4% down on Monday and touched respective lows on Tuesday of $101.08 and $97.06 a barrel, pressured by concerns over demand in China, the world’s largest crude oil importer.
Chinese capital Beijing has expanded its COVID-19 mass testing to much of the city of nearly 22 million as the population braces for a lockdown similar to Shanghai’s stringent curbs.
But Brent rose by $2/bbl earlier in the session after the People’s Bank of China said it will step up monetary policy support to the real economy.
The prospect of supply tightness in the physical market related to the phasing out of Russian oil also added to bullish sentiment.
Germany hopes to replace all deliveries of oil from Russia in a matter of days, Economy Minister Robert Habeck said on Tuesday.
Analysts said the release of oil from emergency reserves had eased concerns over tight supply to a certain extent.
“Focus has shifted towards the demand side of the equation and worries about prolonged supply disruptions have greatly been mitigated by the release of 240 million bbls of SPR oil by IEA members and by the ostensible, albeit somewhat obscured, dealing in Russian oil,” said Tamas Varga of oil broker PVM.
In a bearish signal for oil markets, five analysts polled by Reuters estimated on average that U.S. crude inventories had increased by 2.2 million barrels in the week to April 22.
The poll was conducted ahead of the release of the inventory report from the American Petroleum Institute at 4:30 p.m. EDT (2030 GMT) on Tuesday. The official government Energy Information Administration data is due out on Wednesday.
Separately, the CPC pipeline and Black Sea terminal, which ship about 80% of Kazakh crude exports, returned to full capacity on April 23 after working at half capacity for several weeks owing to storm-damaged mooring points.
(Additional reporting by Mohi Narayan in New Delhi and Liz Hampton in Denver; Editing by Louise Heavens and David Goodman)
Brent crude is a major trading classification of crude oil originating from the North Sea. It serves as a global benchmark for oil prices.
West Texas Intermediate (WTI) is a grade of crude oil used as a benchmark in oil pricing. It is sourced from North America and is known for its high quality.
Monetary policy refers to the actions taken by a country's central bank to control the money supply and interest rates to achieve macroeconomic goals.
Crude oil inventories are the amount of crude oil held in storage facilities. They are crucial indicators of supply and demand in the oil market.
The CPC pipeline is a major oil pipeline that transports crude oil from Kazakhstan to the Black Sea, playing a vital role in the region's oil exports.
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