Oil Prices End Positive on Demand Optimism
The oil market recorded a weekly gain due to demand optimism following signals that Chinese imports would increase at the same time U.S. dollar index limit upside.
The World Bank on Thursday raised its forecast for China’s economic growth in 2024 and 2025. Beijing also revised upwards the size of its economy by 2.7% to 129.4 trillion yuan. However, a strengthening US dollar weighed on oil prices and capped gains. A stronger dollar makes oil more expensive for holders of other currencies.
The international benchmark Brent crude traded at $73.35 per barrel while West Texas Intermediate (WTI), the American benchmark, traded at $70.04 a barrel at the same time on Friday, a rise of about 0.82% from last Friday’s session, which closed at $69.47 per barrel.
Oil trading volume thinned during the holiday-shortened week. On Friday, oil prices were supported by demand optimism in China, the world’s largest crude oil importer, following the World Bank’s upward revision of the country’s growth forecast.
However, a strengthening US dollar limited price gains in oil markets, as a stronger dollar makes oil more expensive for holders of other currencies. Prices supported following news of China’s plan to issue 3 trillion yuan, equivalent to $411 billion, in special Treasury bonds to boost its economy.
Rising supply and demand expectations for fossil fuels supported prices as incoming US President Donald Trump prepares to take office on Jan. 20. The majority of global markets remained closed on Wednesday due to the Christmas holiday break.
Oil prices initially rose early in the week on lower-than-expected US inflation data and were later supported by strong US growth data boosting demand optimism. #Oil Prices End Positive on Demand Optimism CBN Opens FX Window for BDC to Stock up at NFEM Rate
