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China’s latest Covid-19 wave could be far more serious than the government is claiming, a UK research firm has reported, as cited by Reuters.
According to health data firm Airfinity, more than 5,000 people are probably dying each day from COVID-19 in China, with the firm’s mortality risk analysis suggesting that 1.3 to 2.1 million people could die in the country’s current COVID outbreak. Those figures are "in stark contrast to the official data which is reporting 1,800 cases and only seven official deaths over the past week," and could derail the ongoing oil price recovery.
Oil prices rose by as much as 3.1% on Wednesday, with the rally extending to Thursday's intraday session after a report by the U.S. Energy Information Administration showed a bigger-than-expected draw in U.S. crude stockpiles. Front-month Nymex crude oil for January delivery gained 2.3%, to $77.99 a barrel while Brent crude futures for February rose 2.7% to $82.18 a barrel.
An abrupt U-turn by China on its previous zero-COVID policy following protests has raised global concerns of widespread infections among a vulnerable, under-vaccinated population. Three weeks ago, Beijing announced the most sweeping changes to its strict Covid-19 guidelines, including relaxing testing requirements and travel restrictions.
Further, people infected with Covid-19 but have only mild or no symptoms are now allowed to isolate at home instead of convalescing in centrally managed facilities. China also announced plans to stop tracking some travel, potentially reducing the likelihood people will be forced into quarantine for visiting COVID-19 hot spots.
The surprise announcement comes just a month after Beijing doubled down on what is widely viewed as overly strict Covid-19 measures. For nearly three years, China has been implementing some of the world’s strictest pandemic control policies, imposing incessant lockdowns across the country, shutting down borders, and conducting mass-scale COVID-19 tests to contain the spread of the virus. But now the pendulum has swung the other way with Airfinity estimating the wave could peak at 3.7 million a day in mid-January in regions where cases are currently rising and 4.2 million a day in March in other provinces.
By Alex Kimani for Oilprice.com
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Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com.