Oil rallied at the start of the week on hopes of renewed Chinese crude buying

Oil rallied at the start of the week on hopes of renewed Chinese crude buying

Oil rallied at the start of the week on hopes of renewed Chinese crude buying and as the dollar extended its decline.

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West Texas Intermediate futures surged as much as 3.8 percent to move above $76 a barrel Monday. China issued a fresh batch of crude oil import quotas in a sign that the world’s largest purchaser may be about to boost consumption.

Meanwhile, the Federal Reserve may lean toward smaller interest-rate increases after wage growth cooled in December, another step down in its aggressive campaign of monetary tightening. That’s put pressure on the US dollar, which slipped again Monday, and added to tailwinds for commodities priced in the currency.

Crude had a sluggish start to the year, posting a drop of around 8 percent last week as nearby oil markers flash signs of weakness. For now traders are awaiting signs of a meaningful up-tick in Chinese demand, though there has been improvement in mobility gauges over recent days.

“China reopening remains the major bullish catalyst story out there, said Keshav Lohiya, founder of consultant Oilytics. “We are generally on the oil bull side, but the price rise will not be