Crude in London held steady, after earlier climbing as much as 0.8%, with the dollar’s gain making commodities priced in the currency less attractive.
Still, growth in Chinese exports last month suggests strong demand for goods in the U.S. and Europe. The country’s overall imports also surged, with crude purchases climbing to a five-month high, pointing to a revival in Asia’s biggest economy following a recent wave of Covid-19 infections.
“The good news is that Chinese exports expanded at an unexpected pace in August,” said Tamas Varga, an analyst at oil brokerage PVM Oil Associates. “The question is how long the delta variant will weigh on demand forecasts.”
The fast-spreading delta variant has raised demand concerns in recent weeks, though China was able to swiftly contain its latest outbreak. There are expectations that the market will tighten over the rest of 2021, with the Organization of Petroleum Exporting Countries and its allies deciding last week to keep boosting supply on a bet that the recovery will accelerate.