LONDON: Oil prices rose on Wednesday to their highest since early December on optimism that the lifting of China’s strict Covid-19 curbs will lead to a fuel demand recovery in the world’s top oil importer.

Brent crude futures were up $1.58, or 1.84 per cent, to $87.50 a barrel by 1458 GMT. US West Texas Interm­ediate (WTI) crude futures rose $1.83, or 2.28pc, to $82.01. Both were at their highest since early December.

China’s economic growth slowed sharply to 3pc in 2022, missing the official target of “around 5.5pc” and marking its second-worst performance since 1976.

But the data still beat analysts’ forecasts after China started rolling back its zero-Covid policy in early December. Analysts polled by Reuters expect growth to rebound to 4.9pc this year.

The lifting of Covid-19 restrictions in China is set to boost global oil demand to a record high this year, the International Energy Agency (IEA) said on Wednesday, while price cap sanctions on Russia could dent supply.

The IEA report followed a projection from the Organization of the Petroleum Exporting Countries (Opec) for Chinese oil demand to grow by 510,000 barrels per day (bpd) this year after contracting for the first time in years in 2022 because of Covid containment measures.

Published in Dawn, January 19th, 2023