Oil prices are near flat on Friday as optimism about a possible increase in energy demand in China waned and the market aggravated concerns about high inflation.
Brent crude futures lost 12 cents to trade at $92.26 a barrel as of 0219 GMT. West Texas Intermediate (WTI) futures fell 4 cents to $84.47 a barrel.
Brent is on track for a weekly gain of 0.7%, while WTI is expected to drop 1.3% after the renewal of its pre-month contracts.
It is said that the US Federal Reserve is trying to slow down the economy to fight inflation and will continue to raise its short-term interest rate target.
High inflation requires more rate hikes. The advocacy of even higher interest rates this week by several key Fed members dampened optimism about China’s waning hopes of quarantine.
Russia is preparing to substantially exceed the new G7 oil price cap. Investors are looking for an opportunity for a commodity boost based on the reopening of China.
While it is said that Beijing is considering reducing the quarantine period for visitors from 10 days to seven days, no official confirmation has yet come.
China, the world’s largest importer of crude oil, has this year adhered to strict COVID-19 restrictions that weighed on business and economic activity and lowered fuel demand.
The European Union’s impending ban on Russia’s crude oil and petroleum products, as well as production cuts from the Organization of the Petroleum Exporting Countries and allies, including Russia, have supported prices recently.
OPEC+ agreed to a 2 million bpd production cut in early October.
