Oil prices rose marginally due to Middle Eastern instability and Chinese stimulus plans, despite concerns over global growth and trade tariffs. Brent crude reached $71.24 and WTI $67.72 per barrel, influenced by U.S. actions in Yemen and positive retail sales data from China.
Oil prices experienced a slight increase on Tuesday, buoyed by instability in the Middle East and supportive actions from China’s economic stimulus. Brent crude rose by 17 cents to $71.24 per barrel, while U.S. West Texas Intermediate crude climbed 14 cents to $67.72 per barrel. Although global growth concerns and ongoing trade tensions limited these gains, the overall trend remained positive.
According to ING analysts, several factors, including U.S. military strikes on the Houthis in Yemen, bolstered market support. China’s announcement of a special action plan aimed at enhancing domestic consumption also contributed to this support, alongside promising retail sales and fixed asset investment growth figures.
In January and February, China’s crude oil throughput saw a 2.1% year-over-year increase, owing to new refinery operations and seasonal travel. The positive sentiment was further propelled by President Donald Trump’s commitment to intensify U.S. efforts against Yemen’s Houthis unless they cease their maritime attacks.
However, persistent concerns about demand emerged as the OECD reported that U.S. tariffs could negatively impact economic growth in North America, subsequently affecting global energy demand. Analyst Robert Rennie highlighted that surging global supply and ongoing trade conflicts might lead oil prices to decline towards the mid $60s.
In addition, Venezuela’s PDVSA demonstrated intentions to continue its oil production despite the upcoming expiration of Chevron’s operating license. Furthermore, discussions between President Trump and Russian President Vladimir Putin regarding the Ukraine conflict are particularly noteworthy, with markets speculating that a potential resolution could result in an easing of sanctions and increased crude supply from Russia, which would likely affect oil prices.
In summary, oil prices have risen slightly due to geopolitical instability and China’s economic stimulus efforts. Although growth concerns and tariff implications continue to pose challenges to demand, supportive measures from China and ongoing tensions in the Middle East help to mitigate these effects. Future trends will depend on negotiations concerning the Ukraine situation and how they impact global oil supply.
Original Source: shafaq.com
