OPEC Secretary General stated that the reopening of the Chinese economy after the covid restrictions will push the demand for oil by more than 500,000 barrels per day
The Organization of Oil Producing Countries (OPEC) Secretary General Haitham al-Ghais told Sky News Arabia, a Middle East-based 24-hour news channel broadcast, from Davos on Tuesday that the reopening of the Chinese economy after the covid restrictions will push the demands of oil by more than 500,000 barrels per day. Al-Ghais was at the World Economic Forum held in Davos, Switzerland. The event will take place from 16 to 20th January. The Forum is a Public-Private Cooperation to engage political, business, cultural, and other leaders to shape global industrial agendas.
China Covid mayhem
China is in the clutches of COVID-19 again for most of 2022. The Xi Jinping-led Chinese government had called for a zero covid policy. This policy included lockdowns even in places where only a few cases were detected, mass testing of people everywhere was taking place and those found positive were ordered to be isolated at their homes or quarantined under the government-run quarantine center.
Viral videos and images sneaked out of the government-controlled social media, which showed the horrific conditions of the Chinese citizens who were locked and sealed in their homes, just like house arrest. The police had full autonomy; their only goal was to curb the spread of coronavirus and implement the restriction to the best of their ability.
PC: Reuters
Change in China’s Covid policy
People started protesting as if they had had enough of the torture by the guards. Protests started emerging in various parts of the country in November against the strict lockdowns. The government tried to curb these protests but ultimately gave in to the demands and lifted the zero-Covid policy, which was considered one of the most stringent anti covid actions by any government. The quarantine and lockdown rules were removed, and a negative covid report was also no longer required to roam in public places.
On 8th January, China opened its boundaries with no quarantine measures, negative covid reports, and zero travel restrictions.
Chinese vaccination program
According to sources, over 90% of the Chinese population has been vaccinated. Near the lifting of the zero covid policy, only half of the super senior citizens or people above 80 had received three vaccine doses. The Chinese authorities are now focusing on vaccinating the whole population, especially elders.
On its path to becoming self-reliant, China uses the vaccines produced on its land rather than importing them from any other country.
Ray of hope for the Chinese economy
Last month Jinping lifted the covid restrictions to get the economy back on track after months of restrictions that halted the economic wheels of the nation. The GDP numbers came out to be only 3% in 2022, which is way farther than what economists expected, and it missed even the government target of 5.5%.
Other Chinese economic data, such as production, retail sales, and so on, came alongside the GDP numbers, which were well above the market expectations but weaker than pre-pandemic levels.
However, an analyst expects the economy to grow at a slower pace compared to the growth it has seen in the past decades. The reopening will add momentum to the growth pace held by consumer spending, as we saw that retail sales numbers were not disappointing. Reopening, on the other hand, will lead to a new cycle of production, construction, and travel, pushing overall demand in a 360-degree manner.