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China will stop collecting and reporting comprehensive Covid case data after it ended mandatory testing for the virus.
The move comes amid a general relaxation of Covid-related restrictions as Beijing adjusts its zero-Covid policy following a wave of protests against the restrictions in large Chinese cities.
Bloomberg reports from now on the Chinese authorities will only report symptomatic cases of the viral infection as the non-symptomatic ones would be impossible to record without mandatory tests.
The country’s reconsideration of its zero-Covid policy has been seen by most as a strong bullish factor for oil prices and benchmarks have been trending higher since China began relaxing the restrictions.
Morgan Stanley this week raised its forecast for China’s economic growth thanks to the reopening of the country, now expecting its economy to grow by 5.4 percent next year, from an earlier forecast of 5 percent.
“From our perspective, policymakers are taking concerted action to lift growth across all fronts,” the bank’s analysts wrote. “This is the first time since 2019 where domestic macro policies and Covid management are aligned in supporting a growth recovery, rather than acting as countervailing forces.”
This would mean higher oil demand, too, which is what has pushed Brent crude to $80 a barrel for the first time in weeks, while West Texas Intermediate remains around $75 per barrel.
OPEC also recognized the role of China’s Covid relaxation for next year’s oil demand, saying in its latest Monthly Oil Market Report.
“A resolution of the geopolitical conflict in Eastern Europe and a relaxation of China’s zero-COVID policy could provide some upside potential,” the cartel said.
According to OPEC, Chinese crude oil demand is seen at 14.79 million barrels daily this year, down by 180,000 bpd from 2021 because of the Covid restrictions, after four years if annual increases.
