Commodity Market: WTI Crude Oil off a three-month high as new Shanghai lockdown measures outweigh upbeat China macro data

Futures on US West Texas Intermediate Crude Oil eased from a three-month peak on Thursday, as new COVID-19 lockdown measures imposed in parts of Shanghai overshadowed better-than-anticipated export data from China.

Chinese exports surged 16.9% year-on-year in May, or at the fastest rate since January and well above market consensus, as relaxation of coronavirus-related restrictions allowed some factories to resume operations.

“The export performance is impressive in the context of the country’s multi-city lockdowns in the month,” Stephen Innes, managing partner at SPI Asset Management, wrote in an investor note.

However, upbeat data had a rather brief bullish effect on oil prices.

“Of far greater importance is news that a district of Shanghai has been locked down today, reviving fears of another leg of China weakness due to its covid-zero policies. That is capping any gains in Asia today,” Jeffrey Halley, OANDA’s senior market analyst for Asia Pacific, was quoted as saying by Reuters.

New lockdown restrictions were imposed in parts of Shanghai on Thursday, as residents of the Minhang district were ordered to remain at home for two days.

Still, a price-supporting factor continued to be peak summer fuel demand in the United States.

The United States registered a record drop in strategic crude reserves even as commercial stockpiles increased last week, according to data from the Energy Information Administration.

As of 8:32 GMT on Thursday WTI Crude Oil Futures were retreating 0.47% to trade at $121.53 per barrel. Earlier this week the black liquid went up as high as $123.18 per barrel, which has been its strongest price level since March 9th ($126.84 per barrel).

At the same time, Brent Oil Futures were losing 0.38% on the day to trade at $123.25 per barrel. Earlier this week Brent Oil went up as high as $124.36 per barrel, which has been its strongest price level since March 9th ($131.59 per barrel).