London, (Business News Report)|| Oil prices rose Thursday morning, supported by the recovery in demand in China, after easing the COVID-19-related restrictions.
Support for the continuity of negotiations on the implementation of the European embargo on Russian oil, from the rise in oil prices, and the exacerbation of global inflation and stagnation.
Meanwhile prices received support from China’s easing of Coronavirus related restrictions and the reopening of the country early next month.
Oil analysts say that oil prices rose to their highest level in eight weeks amid tightness in the global fuel market and expectations that Chinese demand will begin to recover soon.
They stressed that the world’s largest oil traders are reducing Russian crude exports, at a time when the market is trying to figure out who will fill the void.
The specialists added that Russia’s ability to find brokers, ships and buyers for its crude is pivotal to both the global oil market and Moscow, and the fewer barrels the country exports, the greater the pressure on supplies.
They noted that if there was a blanket ban by the European Union, the Russian oil trade would have to become more private, while some of those cheap barrels would continue to flow into limited outlets in Asia.
In this context, Dr. Philip Debesch, head of the European Energy Initiative, says that there is pressure on Asian buyers to exit deals to buy Russian oil, which headed east to compensate for losses.
They pointed out that oil traders and brokers across Asia have detected that more ships loaded with Russian crude cargo are being chartered by smaller charterers with the EU ban expected, in addition to the exit of major companies putting increasing pressure on Asian customers to stop taking these barrels.
For his part, Andrei Yaniv, a Bulgarian analyst and researcher in energy affairs, believes that the rise in oil prices this week is due to the return of optimism to the market, as the gradual easing of Chinese closure rules revived hopes that purchases in East Asia will witness strong growth during the summer months.
He added that, on the other hand, we find that the European Union still has not formalized an agreement on sanctions for Russian oil and products, as it seems that the deal now depends on only one country, which is Hungary.
He pointed out that if the European Union is able to persuade Hungary to join the sanctions, prices are likely to rise further due to the tightening of supplies in light of the contraction of Russian oil exports.