Oil prices climb as China plans to raise U.S. crude imports, Bonny Light sheds $0.58

Chinese state-owned oil companies have temporarily arranged for tankers to convey a minimum of 20 million barrels of U.S. crude for August and September, Reuters said on Friday, as China enlarged energy and farm buys ahead of a review of the Sino-US trade deal.

Unprecedented crude imports from the top oil importer in the world and the relaxation of coronavirus curbs globally have helped oil prices even though new surges of the virus outbreaks in many countries are expected to cool consumption again.

‘Oil demand data was largely positive last week, with U.S. implied gasoline demand rising to just 3.5% away from pre-coronavirus levels and China’s processed crude oil figure in July at a record high,’ said Howie Lee, an economist at Singapore’s OCBC bank.

ANZ projected that demand has grown by 8 million barrels per day (bpd) in the last four months to 88 million bpd – still 13 million bpd smaller below the figure recorded at this time last year.

Read also: Oil prices rise after steep fall in U.S. crude stocks

Investors are seeking more clues on future supply from a meeting this week of a team representing ministers of the Organisation of the Petroleum Exporting Countries (OPEC) and its allies, popularly called OPEC+.

The talks have been pushed back to 19^th August, a day later than earlier arranged.

The panel, named the Joint Ministerial Monitoring Committee (JMMC), tracks OPEC+ output curbs agreed earlier this year.

In July, the JMMC advised that cuts be reduced from 1^st August to around 7.7 million bpd from a slash of 9.7 million bpd since May in compliance with an earlier OPEC+ agreement.

“The attention would likely be once again on quota compliance,” OCBC’s Lee said.

In the U.S., the number of oil and natural gas rigs running last week remained anchored at a record low for a 15^th week even as higher oil prices impel some producers to begin drilling again.