Oil futures headed higher on Wednesday, as China’s rollback of some COVID-19 measures boosted the outlook for energy demand and traders awaited a report from the U.S. government that’s expected to show a weekly decline in domestic crude inventories.
Worries about more aggressive monetary tightening by the Federal Reserve rippled across markets in recent days, pulling oil prices down for three sessions in a row, despite concerns about the impact of the Group of Seven price cap on Russian oil imposed on Monday. And now “we have heard from the officials about a further easing of those measures,” providing support to investor sentiment in Asia — with the “spillover of this sentiment” likely impacting Europe and the U.S. given that China is the second biggest economy in the world, he said.