Crude oil rises 2% due to positive data in the United States

Crude prices rose nearly 2% on Thursday on expectations that demand will strengthen as China, the world’s top oil importer, reopens its economy and on economic data from the United States.

Brent futures rose $1.35, or 1.69%, to $87.47 a barrel and U.S. West Texas Intermediate (WTI) futures rose 86 cents, or 1.1%, to $81.01.

The Mexican export mix rose 1.79%, or $1.25, to $71.07 a barrel.

The US economy maintained a strong pace of growth in the fourth quarter as consumers increased spending on goods, but momentum appeared to slow considerably towards the end of the year, with higher interest rates eroding demand.

“The reopening of China is supporting the demand outlook,” said Giovanni Staunovo, an analyst at UBS. “In addition, market players are closely watching the upcoming OPEC+ JMMC (Joint Ministerial Supervisory Committee) meeting and the EU embargo on refined products.”

China eased strict Covid-19 restrictions this month and Beijing has reopened its borders for the first time in three years.

Crude inventories increased by 533,000 barrels to 448.5 million in the week ending January 20, according to the Energy Information Administration. Forecasts for a 1 million barrel build were not met, although the EIA says inventories are at their highest level since June 2021.

The OPEC+ ministerial panel meeting on February 1 is likely to support the current pumping levels.