Oil prices totally dependent on China?
US, WASHINGTON (ORDO NEWS) — The pace of recovery in oil demand in China and around the world can be generated by policy meetings in China, which will begin on Friday and which will outline the future course for the Chinese economy, affected by the coronavirus pandemic.
The People’s National Congress, China’s most important annual policymaking event, is expected to decide what kind of incentive an economy needs to slow down during the COVID-19 pandemic.
According to Bloomberg News, many potential solutions to support infrastructure, railways and other sectors could increase China’s demand for oil, fuel, steel, and copper.
Spending on priority areas — technology, transportation, and energy infrastructure — could reach $ 205 billion in 2020, the BNEF report said.
If China strengthens the incentives of an economy that contracted by 6.8% in Q1 during the country’s outbreak of coronavirus, industrial activity will accelerate. In this case, you will need more petroleum products, such as diesel fuel.
China has already supported its economy. However, additional incentives are expected to be announced at the annual meeting, especially given the high unemployment rate. He is also going to set goals for economic growth this year.
In April, the Chinese economy showed signs of recovery from lows earlier this year. For example, in industrial production, the first increase was recorded in 2020 according to the National Bureau of Statistics and Caixin Global.
On Monday, Bloomberg reported that oil demand in China, the world’s largest oil importer, has recovered to the level noted before the coronavirus crisis.
When the country began quitting more than one month of quarantine, Chinese refineries increased refining rates in April by 11%, or 13 million barrels per day, compared with April 2019.
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