Oil prices were largely unchanged in early Asian trade on Thursday as traders weighed optimism over China’s demand outlook against the possibility of further interest rate hikes from global central banks.
Brent crude futures were up 1 cent at $82.71 per barrel at 0121 GMT while U.S. crude futures fell 4 cents to $77.24.
The market was bolstered by projections from the International Energy Agency seeing Chinese oil demand recovering next year after a 400,000-bpd contraction in 2022. The agency raised its 2023 oil demand growth estimate to 1.7 million bpd for a total of 101.6 million bpd.
Road and air traffic in China has rebounded sharply in the past month, data suggests.
Oil prices have also been supported by an outage of TC Energy Corp’s Keystone Pipeline, which ordinarily ships 620,000 barrels per day of Canadian crude to the United States.
Officials said the cleanup from the leak that caused the outage would take at least several weeks.
The U.S. Federal Reserve raised its benchmark overnight interest rate by 50 basis points on Wednesday, a downshift from the 75-basis-point hikes it had delivered at its previous four policy meetings. The central bank signalled that more interest rate hikes were to be expected.
U.S. crude oil stockpiles also rose by more than 10 million barrels last week, the most since March 2021, buoyed by releases from the Strategic Petroleum Reserve and as refiners reduced activity.