International benchmark Brent crude traded at $78.80 per barrel at 09.44 a.m. local time (0644GMT), up 1.23% from the closing price of $77.84 a barrel in the previous trading session. American benchmark West Texas Intermediate (WTI) traded at $73.81 per barrel at the same time, a 1.33% gain after the previous session closed at $72.84 a barrel.
The falling value of the US dollar supported higher oil prices by encouraging traders using other currencies. A weaker dollar further fuels strong demand in the market. Meanwhile, global recession fears led to lower demand expectations. Weaker demand worries heightened especially after IMF Managing Director Kristalina Georgieva said one-third of the world's economies are expected to go into recession in 2023.
Low demand fears are also supported by rising COVID cases in China, which cap further price increases. Adding to demand worries, the world's second-largest economy, China, significantly increased its first batch of 2023 export quotas for refined oil products, which shows the country is expecting less consumption.