WTI crude futures steadied above $79 per barrel on Monday as investors weighed an improving demand outlook in China against the prospect of an economic slowdown in other major economies. The US oil benchmark rallied more than 8% last week as Chinas reopening from Covid curbs raised hopes for a boost in economic activity and mobility, with analysts forecasting oil demand in the top crude importer will likely hit a record this year. Easing inflation expectations in the US also bolstered bets for less aggressive interest rate hikes from the Federal Reserve, fueling a rally in risk assets. Meanwhile, investors remain cautious about fears of a global recession, with major US banks increasing their reserves to protect against deteriorating economic prospects this year. Investors now look ahead to market outlook reports from OPEC on Tuesday, followed by the IEA on Wednesday.
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