Brent crude rose 12 cents, or 0.1%, to $88.31 a barrel as of 2:50 p.m. GMT. U.S. West Texas Intermediate (WTI) crude rose 8 cents, or 0.1%, to $81.70.
“The (U.S.) economy could still recover and some energy traders are still skeptical about how quickly China’s crude demand will rebound this quarter,” OANDA analyst Edward Moya said in a statement. note.
This week, traders are watching more trade data as the corporate earnings season gathers pace, offering clues to the health of economies around the world.
On the inventory side, U.S. crude oil and gasoline inventories are expected to have risen last week while distillate inventories are expected to fall, according to a preliminary Reuters survey on Monday.
Reports are expected from the American Petroleum Institute at 4:30 p.m. ET (2130 GMT) on Tuesday and from the Energy Information Administration at 10:30 a.m. (1530 GMT) on Wednesday.
JP Morgan Bank raised its forecast for Chinese crude demand but maintained its projection of an average price of $90 a barrel of Brent crude in 2023. “Absent major geopolitical events, it would be difficult for oil price to rise above $100 in 2023 as there is expected to be more supply than demand this year,” he said in an analyst note.
Crude oil prices in physical markets started the year with a recovery due to increased buying from China after the easing of pandemic controls and fear among traders that sanctions against Russia could tighten the ‘offer.
The dollar, meanwhile, hovered near a nine-month low against the euro and gave back its recent gains against the yen as traders continued to assess the risks of a U.S. recession and the trajectory of the Federal Reserve policy.
A weaker US currency makes dollar-denominated commodities such as oil cheaper for buyers using other currencies.
Investors retreated into oil futures and options at the fastest pace in more than two years as worries about a slowdown in the global economic cycle eased.
Eurozone business activity made a surprise return to modest growth in January, S&P Global’s Composite Purchasing Managers’ Index (PMI) showed on Tuesday, but Britain’s private sector economic activity fell. at its fastest pace in two years.