Oil Rises as End of China’s Covid Rules Counters Growth Concerns

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(Bloomberg) Oil rose as investors weighed a potential boost for energy demand after China abandoned its Covid Zero policy against persistent concerns over a global economic slowdown.

West Texas Intermediate futures traded above $76 a barrel, also getting a boost from a weaker dollar, which makes commodities priced in the currency more attractive. China’s efforts to revive its economy by removing harsh virus curbs is spurring hopes of higher consumption in the long term, despite a surge in cases clouding the near-term outlook.

Continued supply disruption in the US are also bringing some bullish sentiment. Oil output in North Dakota has fallen by about 300,000 barrels a day since a winter storm last week and the recovery will take a few weeks. Meanwhile, TC Energy Corp.’s restart plan for the Keystone pipeline, which was halted earlier this month, is under review, the Pipeline and Hazardous Materials Safety Administration said on Monday.

Oil Steadies as Investors Weigh Demand Outlook | China's dismantling of Covid Zero vies with slowdown concerns

Lower trading volumes ahead of the holiday period and a weak dollar were both impacting the market on Tuesday, according to Ole Hansen, head of commodities strategy at Saxo Bank.

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Crude is still on track for a second monthly loss with a persistent lack of liquidity leaving prices prone to large swings. The US Federal Reserve is continuing with aggressive interest-rate hikes, while a top European Central Bank official said it would take time for inflation to be brought down.

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