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Oil prices stabilized on Tuesday, after a sharp 4 percent drop in the previous session, after concerns about fuel demand in China were allayed by the central bank’s pledge to support the economy affected by Covid-19 restrictions.
Brent crude futures rose 59 cents, or 0.58 percent, to $102.91 a barrel, after rising to $103.93 earlier in the session.
US West Texas Intermediate crude contracts rose 34 cents, or 0.35 percent, to $98.88 a barrel at 0658 GMT, after jumping to $99.82 a barrel in early trading.
Both crudes fell about four percent on Monday, with Brent crude dropping as much as seven dollars a barrel in the session, while West Texas Intermediate crude fell nearly six dollars a barrel.
The People’s Bank of China said in a statement on Tuesday that China will keep reasonably plentiful liquidity in financial markets, a day after the central bank announced a cut in banks’ foreign exchange reserve ratio to support the economy.
On the supply side, analysts said that the phasing out of Russian oil from the market will continue to support prices.
In a sign that oil markets are headed lower, five analysts polled by Reuters estimated that US crude stocks increased on average by 2.2 million barrels in the week ending April 22.
The survey was conducted before the release of the inventory report from the American Petroleum Institute at 2030 GMT on Tuesday. Official government Energy Information Administration data will be released on Wednesday.
