WTI oscillates around $118.00, upside looks likely as China reopens

• The black gold is juggling in a 40-pips range after a mild correction.
• China's reopening will spurt the economic activities and will eventually raise growth forecasts.
• OPEC+ has announced more output for July and August by 648k barrels.

West Texas Intermediate (WTI), futures on NYMEX, is displaying back and forth moves in a narrow range of $117.30-117.70 in the Asian session. The black gold is juggling after a minor pullback and is gearing for a continuation of the upside momentum as the reopening of China after a painful lockdown of two months in Shanghai and Beijing has bolstered the odds of a demand recovery.

Chinese administration loaded curbs on the movement of men, materials, and machines to contain the spread of the Covid-19. Zero tolerance on lockdown measures brought a slippage in the aggregate demand and eventually in the usage of oil. Now, the reopening of China after a severe lockdown has underpinned the oil bulls. It is worth noting that China is the largest importer of oil and a recovery in oil demand in China carries a significant impact on oil prices.

Meanwhile, supply constraints are expected to ease further as the OPEC+ has promised to pump more oil into the global oil supply. To fix the imbalance in the demand-supply mechanism, the OPEC+ has announced more output for July and August by 648k barrels.

An embargo on oil imports from Russia by the European Union (EU) has triggered a prolonged supply constraint scenario. Beyond some exceptions for Hungary, the EU will end its dependence on fossil fuels from Russia. A long-term prohibition of oil from Moscow will keep oil prices elevated unless otherwise, the world economy shifts to cleaner energy.