Oil rates edged higher on Thursday during holiday trading
Date
12/26/2024 2:23:41 AM
(MENAFN) Oil prices edged higher on Thursday during weak holiday trading, buoyed by optimism surrounding potential additional fiscal stimulus in China, the world's largest importer of oil, according to a report by Reuters. brent crude futures saw a slight increase of 11 cents, or 0.2 percent, reaching USD73.69 per barrel by 0148 GMT, while U.S. West Texas Intermediate crude rose by 15 cents, or 0.2 percent, to settle at USD70.25 per barrel, following its pre-Christmas closure on Tuesday.
The positive sentiment in the oil market is tied to China's plans to bolster financial support for consumption in the coming year. The Ministry of Finance announced on Tuesday that measures will include increasing pensions, providing subsidies for residents' medical insurance, and expanding initiatives like consumer goods swaps. These efforts are part of a broader strategy to stimulate domestic demand and revitalize the economy.
Additionally, Chinese authorities have approved the issuance of 3 trillion yuan (USD411 billion) in special treasury bonds for the next year, as reported by Reuters, citing sources familiar with the matter. This significant fiscal stimulus is aimed at reinvigorating China's economy, which has faced challenges in recent months. These measures have further strengthened market confidence, with analysts pointing to China’s increased spending as a key driver for oil demand.
Market support also comes from expectations of a decline in U.S. crude oil and fuel inventories, signaling tighter supply. Satoru Yoshida, a commodities analyst at Rakuten Securities, highlighted that China's economic stimulus measures are bolstering oil markets. He also noted that optimism surrounding potential growth in fossil fuel production and demand, following Donald Trump’s upcoming inauguration as U.S. President, is contributing to the positive outlook for oil prices.
MENAFN26122024000045015839ID1109030845
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.