SINGAPORE- Oil prices rose nearly 1 percent on Monday, extending gains from the previous session as China eased some of its strict COVID-19 protocols, fueling hopes of a recovery in economic activity and demand at the world’s top crude importer.
Brent crude futures rose 87 cents, or 0.9 percent, to $96.86 a barrel after settling up 1.1 percent on Friday.
US West Texas Intermediate crude futures were at $89.76 a barrel, up 80 cents, or 0.9 percent, after closing Friday’s session 2.9 percent higher.
Commodities prices rallied on Friday after China’s National Health Commission adjusted its COVID prevention and control measures. But COVID cases climbed in China over the weekend.
“This policy pivot will help limit downside fears of a protracted restrictive approach to on-onshore activity, but it doesn’t eliminate the immediate demand hit from current lockdowns,” SPI Asset Management’s Stephen Innes said in a note.
The easing curbs included shortening quarantine times for close contacts of cases and inbound travellers by two days, as well as eliminating a penalty on airlines for bringing in infected passengers.
“The latest easing in quarantine requirements is certainly a step in the right direction, but the market will likely need to see further easing if this recent enthusiasm is to be sustained,” ING said in a note.
