Oil dips, but strong Chinese demand underpins

Oil prices dipped on Friday, weighed down by a strengthening U.S. dollar, although China's relentless thirst for crude and OPEC-led supply cuts prevented further falls.

Preventing prices from sliding further was booming oil demand from China, which will this year overtake the United States as the world's biggest crude importer.

China's crude oil imports will continue to rise over the coming years, as output declines from several of its giant onshore fields... This will inevitably see China become more reliant on crude oil imports over our forecast period, with import dependency set to increase from a record 68.0 percent in 2017 to nearly 80 percent by 2021.

On the supply side, oil prices have been receiving support from the Organization of the Petroleum Exporting Countries (OPEC) and a group of non-OPEC producers, most importantly Russia, which has been withholding supplies to tighten the market.

Largely because of these voluntary production cuts, oil prices rose sharply between June and October, with Brent gaining around 40 percent in value.

Source: Bloomberg Pro Terminal

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