Oil Prices Surge as Demand Outlook in China Improves
Oil prices surged in the global commodities market as demand outlook in China improved after Beijing’s reported increased economic activities. The rally in the commodity markets was also boosted by uncertainties about the policies of US President-elect Donald Trump, who will take office January 2025.
At the last look, the international benchmark Brent crude increased by 0.3%, trading at $80.62 per barrel. The US benchmark West Texas Intermediate (WTI) rose by 0.4%, reaching $78.13 per barrel, compared to its prior session close of $77.77.
According to macroeconomic data released on Friday in China, the country’s economy grew by 5% last year, meeting its annual growth target. Additionally, the region’s industrial production increased by 6.2% year-on-year in December, exceeding forecasts.
As Trump prepares to take office in the US, uncertainties surrounding his cabinet nominees continue to impact oil prices in the world’s largest economy.
Scott Bessent, the nominee for US Secretary of the Treasury, stated that he plans to revitalize the country’s economy by implementing pro-growth regulatory policies, reducing taxes, and harnessing American energy.
Christopher Waller, a member of the Federal Reserve Board of Governors, stated that the Bank could lower interest rates in the first half of the year if inflation decreases as expected.
Waller noted that as long as the inflation data remains positive or continues on its current path, interest rate cuts could happen earlier than what the markets are currently expecting. He stated that if the data remains favourable, they could reduce the interest rate 3 to 4 times this year. However, if the data does not support this trend, the number of potential cuts might decrease to 2 or even 1.
Predictions regarding the enhancement of economic mobility and stimulation of demand in the US, which is the world’s largest oil-consuming nation, are supporting prices.
On the other hand, the January issue of the World Bank’s Global Economic Prospects Report noted that global economic growth is expected to grow by %2.7 in 2025 and 2026, as it was last year, as inflation and interest rates gradually fall.
The possibility that expectations will increase global oil demand in the future contributed to the rise in prices. #Oil Prices Surge as Demand Outlook in China Improves $9.6bn P&ID Scam: I’ve No Witness to Call, Briton Tells Court
