Oil rises on China demand recovery hopes, likely unchanged OPEC+ output policy

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TOKYO: Crude oil edged up on Wednesday (Jan 25) as optimism for demand recovery in China and a likely unchanged output cut decision by major oil producers offset global recession worries.

Brent crude rose 22 cents, or 0.3 per cent, to US$86.35 per barrel by 5.01am GMT after falling 2.3 per cent in the prior session. US West Texas Intermediate (WTI) crude climbed 13 cents, or 0.2 per cent, to US$80.26 per barrel, after a 1.8 per cent drop on Tuesday.

"Expectations that China's fuel demand will recover in the second half of the year are growing and are likely to support the market sentiment," said Hiroyuki Kikukawa, general manager of research at Nissan Securities.

Analysts from the Bank of America Securities said the reopening of the Chinese economy could unleash a large wave of pent-up demand over the next 18 months.