© Reuters. FILE PHOTO: Crude oil storage tanks are seen from above at the Cushing oil hub, in Cushing, Oklahoma, March 24, 2016. REUTERS/Nick Oxford/File Photo/File Photo
By Noah Browning
LONDON (Reuters) – Crude oil prices were steady on Tuesday as concerns about a global economic slowdown and expected build in US oil inventories were offset by hopes of a fuel demand recovery from top importer China.
was up 7 cents, or 0.1%, at $88.26 a barrel at 1320 GMT. US West Texas Intermediate (WTI) crude rose 14 cents, or 0.2%, to $81.76.
“The (United States) economy still could roll over and some energy traders are still skeptical on how quickly China’s crude demand will bounce back this quarter,” OANDA analyst Edward Moya said in a note.
This week traders are watching for more business data as corporate earnings season gathers momentum, offering clues to the health of economies around the globe.
On the inventory side, US stocks of and gasoline were expected to have risen last week while distillate stocks were forecast to fall, a preliminary Reuters poll showed on Monday.
Reports from the American Petroleum Institute, due at 4:30 pm ET (2130 GMT) on Tuesday, and the Energy Information Administration, due at 10:30 am (1530 GMT) on Wednesday.
Bank JP Morgan raised its forecast for Chinese crude demand but maintained its projection for a 2023 price average of $90 a barrel for Brent crude.
“Absent any major geopolitical events, it would be difficult for oil prices to breach $100 in 2023 as there should be more supply than demand this year,” it said in an analyst note.
Crude oil prices in physical markets have started the year with a rally on increased buying from China after the relaxation of pandemic controls and on trader concern that sanctions on Russia could tighten supply.
The dollar, meanwhile, hovered near a nine-month low against the euro and gave back recent gains against the yen as traders continued to gauge the risks of US recession and the path for Federal Reserve policy.
A weaker US currency makes dollar-denominated commodities such as oil cheaper for buyers using other currencies.
Investors have piled back into petroleum futures and options at the fastest rate for more than two years as concerns over a global business cycle downturn have eased.
Euro zone business activity made a surprise return to modest growth in January, S&P Global (NYSE:)’s flash Composite Purchasing Managers’ Index (PMI) showed on Tuesday, but British private sector economic activity fell at its fastest rate in two years.