Wagons carrying oil and fuel at a petroleum products terminal in Riga, Latvia, February 2, 2023.
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Oil edged higher in early trade on Thursday, extending gains for a fourth straight day, as disruptions in crude loading in Turkey and optimism about a recovery in demand in China continued to support sentiment.
Brent crude futures rose 14 cents, or 0.2% to $85.26 a barrel at 0239 GMT, while US West Texas Intermediate (WTI) crude futures firmed by 11 cents, or 0.2% higher, to $78.58 a barrel. Both benchmarks have gained more than 6% so far this week.
BP Azerbaijan declared force majeure on Azeri crude shipments from the Turkish port of Ceyhan on February 7 after a massive earthquake hit Turkey and Syria early on Monday. The disaster halted operations in Ceyhan and disrupted crude oil flows from Iraq and Azerbaijan.
Hopes of a rapid rebound in demand from China also supported oil prices as the world’s second-largest oil consumer ended more than three years of a strict zero-COVID policy involving shutdowns at citywide and mass testing in December.
“We continue to expect sanctions related to the Ukraine-Russia conflict and the reopening of China to be the main price drivers over the next 12 months, where higher oil prices most likely appear at 2H 2023 “, said analysts at NAB Commodities Research in a note. .
However, rising crude oil inventories in the United States put pressure on oil gains. Inventories rose last week to their highest level since June 2021 at 455.1 million barrels.
