The lifting of health restrictions in China and the upcoming decline in supply in the US are driving oil prices higher.

Oil prices rebounded on Wednesday, the day after a drop, hit by the lifting of health restrictions in China as well as the prospect of the end of the program of massive use of US strategic reserves.

The price of North Sea Brent crude for November delivery gained 0.99% to settle at $94.10. The price of a barrel of US West Texas Intermediate (WTI) for October delivery rose 1.34% to $88.48.

A potentially substantial demand lever by 2023

The operators reacted to the announcement of the lifting, this Thursday, of the current confinement in Chengdu, one of the largest Chinese cities with 21 million inhabitants. “The next big move in the oil market could only come from the world’s largest oil importer and the easing of restrictions should lay a solid foundation” for oil prices, Oanda’s Edward Moya reacted in a note.

Traders were also encouraged by figures from the International Energy Agency (IEA), which slightly lowered its 2022 demand estimate but maintained its 2023 demand forecast.

The analyst noted that crude oil also benefited from the slight drop in the dollar, the currency in which most transactions in the oil market are denominated.

Commercial oil inventories increase 2.4 million barrels

Traders also welcomed the weekly report from the US Energy Information Agency (EIA), which showed a larger-than-expected rise in commercial oil inventories to 2.4 million barrels. A figure mitigated by the new massive drainage of strategic reserves, this time amputated by 8.4 million barrels in a week.

The government of US President Joe Biden has set October as the end of the disbursement program for these strategic reserves, which have already been reduced by 187 million barrels since the beginning of September 2021.

This period is framed in an atypical context, marked in particular by the low level of stocks of gasoline, diesel or heating oil in the United States, which is worrying the market. After hitting a low since January in early September, the wholesale price of gasoline in the United States began to rise and reached its highest level in two weeks on Wednesday.