China’s potential economic boost, strong Asian demand, and falling U.S. crude stocks lifted oil prices on Tuesday.
Brent crude prices jumped 64 cents, or 0.8%, to $84.82 a barrel at 0557 GMT, while WTI futures rose 67 cents, or 0.8%, to $80.41.
China’s March consumer inflation was the smallest since September 2021, indicating demand weakness amid an uneven economic rebound and raising hopes Beijing may bolster growth.
CMC Markets analyst Tina Teng said China’s March CPI was lower than predicted, which may encourage the government to bolster the economy.
While the dollar fell on predictions that the Fed will cease its rate rise cycle, crude futures rose. Oil is cheaper for foreigners when the dollar weakens.
“With other central banks delaying rate rises, such as the Reserve Bank of Australia, Bank of Korea… the anticipation for the Fed to further dial back its tightening stance has risen,” Teng added.
March gasoline consumption in India, the third-largest oil user, also helped prices.
Fuel usage rose 5% to a record 4.83 million barrels per day last month.
Since OPEC and allies like Russia stunned the market last week with a fresh round of production restrictions starting in May, oil prices have risen over 5%.
U.S. crude stockpile data is coming Tuesday. Five Reuters analysts assessed that oil stockpiles decreased by 1.3 million barrels in the week to April 7.
Wednesday’s U.S. inflation report may help markets predict interest rates.
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