Stable oil as Chinese data offset coronavirus fears

LONDON (Reuters) – Oil prices held steady on Monday as a better-than-expected quarterly rebound in the Chinese economy thwarted fears about the surge in COVID-19 cases around the world and tight restrictions that could affect economic growth and fuel consumption.

Brent crude oil gained 3 cents, or 0.1%, to $ 55.13 a barrel by 0938 GMT, while US crude oil was up 2 cents, or less 0.1%, to $ 52.38.

China’s economy recovered in the fourth quarter, with growth that beat expectations as it ended a coronavirus-stricken 2020 in extraordinarily good shape and remained poised to expand further this year even as the pandemic raged non-stop.

However, China was in stark contrast to the United States and Europe, where the spread of the coronavirus raised doubts about how soon economies could recover.

“Crown-induced economic fears, a stronger US dollar, and more pessimistic investor sentiment are all playing their part in Brent trading … about $ 3 less than last Wednesday,” he said. Commerzbank analyst Eugen Weinberg.

Security concerns ahead of this week’s US presidential inauguration are also dragging investor sentiment, PVM Oil analyst Tamas Varga said.

“In addition to the runaway coronavirus, this week’s tense presidential inauguration can also cause unease among investors,” he said.

Last week, US drilling rigs put more oil and natural gas plants into operation for the eighth straight week, encouraged by the recent price strength that has made production more profitable, although the number of operating rigs is still less than half of the year. level from a year ago. [RIG/U]

US drillers have indicated that they will continue to monitor their spending, ANZ Research said in a statement.

“The economy is also not conducive to increased drilling, with half of the sector still uneconomical,” they said.

Oil prices have also found support in a decline in Libyan oil production, with Waha Oil Company reducing production to 200,000 barrels per day due to maintenance of the main pipeline connecting the Al-Samah and Al oil fields. -Dhahra at the port of Es Sider.

Reportage by Bozorgmehr Sharafedin in London; Additional reporting by Aaron Sheldrick in Tokyo; Editing by David Goodman