Oil prices surged on Thursday, driven by expectations that China’s new stimulus measures could boost demand, alongside a report showing a continued decline in U.S. crude stockpiles.
Brent crude rose toward $74 a barrel, following a 1.3% gain on Tuesday, while West Texas Intermediate (WTI) surpassed $70, according to reports from News.Az.
China, the world’s largest crude importer, has introduced measures aimed at stimulating growth, including allowing local officials more flexibility in investing proceeds from government bonds. This comes as the country maintains its interest rates and pledges a “moderately loose” monetary policy to support its economy.
Meanwhile, in the U.S., the American Petroleum Institute (API) reported a 3.2 million barrel drop in commercial crude inventories last week. If confirmed by official data, this would mark the fifth consecutive weekly decrease. Typically, U.S. stockpiles decline in December, before building up again in early January.
Chris Weston, head of research at Pepperstone Group, noted that while price movements during this time of year should be viewed with caution, the market sentiment remains bullish, driven by the larger-than-expected stockpile draw in the U.S. and speculation about potential policy shifts in China.
Despite the positive price action, crude is on track for a modest annual decline. Prices have remained relatively stable within a narrow range since mid-October. As traders look toward 2025, they are closely monitoring several factors, including the potential implications of Donald Trump’s upcoming presidency, Beijing’s economic support efforts, and global crude supply dynamics. OPEC+ has indicated that it plans to ease production cuts gradually after a series of delays.
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