The only way oil prices can reach $120 per barrel is if there are a lot of supply disruptions, says Citi's commodities chief

• A rebound in Chinese demand won't shoot oil prices higher, Citi's commodities chief told Bloomberg TV.
• "The only way to get oil back to 110 [dollars] or 120 is to have a bunch of supply disruptions from place like Libya, Nigeria and maybe even Iran and Iraq."

A resurgence in Chinese demand won't be enough for a steep increase in oil prices, according to Citigroup's global head of commodities research.

China's zero-COVID policies have kept a lid on oil prices, though signs of them easing have raised hopes for a rebound in economic activity. But instead of demand, oil prices will follow supply signals, Ed Morse said.

"The only way to get oil back to 110 [dollars] or 120 is to have a bunch of supply disruptions from place like Libya, Nigeria and maybe even Iran and Iraq," he told Bloomberg TV.

On Wednesday, Brent crude prices were up 1.4% at $96.01 per barrel, and West Texas Intermediate rose 1.7% to $89.90.

To be sure, an uptick in China's oil appetite will impact the market, while OPEC+ is trying a establish a floor on prices with its production-quota cuts, Morse said.

"But we're in a world where demand is sloshing downward across the world, whether you look at the US or Europe," he added.

By contrast, China's oil imports are up by 2 million barrels a day since the middle of the summer. But since the OPEC+ meeting, where members slashed quotas by 2 million barrels a day, oil prices have been "in a sideways little dance — it's not going anywhere," Morse said.

"I think there's ample supply in the market for us not to have a big impact from China coming back," he said.