© Archyde.com. Why did oil prices rise following the issuance of some important economic data?
Arabictrader.com – Crude oil prices witnessed a clear rise during Thursday’s trading, following remarkable stability in early trading; supported by the positivity of recent US data; As markets await the entry into force of the Western embargo on petroleum derivatives next February.
In terms of oil trading today, spot prices rose by nearly 0.50%, to settle near $86.71 a barrel, while the prices of US spot crude contracts settled at an increase of regarding 0.2%, to trade near $80.28 a barrel.
The reasons for the rise in oil during today’s trading
The recent US data contributed to supporting the bullish momentum of crude oil prices during trading; As the markets grew in anticipation that the strength of the US demand for oil is increasing; Yesterday, Wednesday, the US Energy Information Administration stated that US oil inventories data this week was better than expected, as oil inventories rose by 500 thousand barrels this week, while market expectations indicated an increase in crude stocks by regarding 1.2 million barrels in the same period; However, although this increase was less than expected, US crude stocks reached their highest levels since June 2021.
As revealed by the US GDP data for the last quarter of last year; The GDP growth in the United States increased by 2.9% during the fourth quarter of last year, which is much better than market expectations, which indicated that the US economy grew by only 2.6%.
These positive data contributed to strengthening the bullish path of crude oil during today’s trading; As it boosted market expectations regarding the recovery of oil demand from America; Where the United States tops the list of countries consuming crude oil globally; Which puts a perception regarding the strength of US demand for oil in the future.
Oil still receives some support from assessing the market prospects for the recovery of Chinese oil demand, which is the largest importer of crude in the world; And this is in the wake of the Chinese authorities’ intention to end the strict epidemiological restrictions that they have adopted since the virus first appeared on its soil, almost.
Economists’ expectations for future oil demand movements
An expert at UBS Bank, Giovanni Staunovo, stated that the reopening of China will support prospects for oil demand, and therefore it is expected to rise in the coming period; MUFG Bank analysts also indicated that commodity markets, including oil, are expected to witness a severe shortage of supply due to the reopening of China, which is the world’s largest driver of commodity demand.
The markets are closely following the upcoming OPEC+ meeting, as well as the developments of the European Union’s ban on Russian petroleum products; Which puts a perception regarding the movements of demand for oil during the coming period.
