Oil prices saw a rise on Wednesday as market participants anticipated an increase in demand from the world’s largest crude importer. This came after Beijing announced a looser monetary policy to stimulate economic growth in China.
Crude futures experienced a 0.5% gain, with Brent crude reaching $72.55 a barrel and U.S. West Texas Intermediate crude rising to $68.95.
China’s decision to implement an “appropriately loose” monetary policy in 2025 has reignited hopes for stronger stimulus measures. However, market analysts are cautious as they await more concrete details beyond positive messaging.
While Chinese crude imports have shown growth for the first time in seven months, concerns remain about potential fallout from trade measures proposed by President-elect Donald Trump.
In the U.S., crude and fuel stocks saw an increase last week, according to market sources citing American Petroleum Institute figures. Crude stocks rose by 499,000 barrels, gasoline inventories by 2.85 million barrels, and distillate stocks by 2.45 million barrels.
Official data on oil stocks from the U.S. Energy Information Administration is expected on Wednesday, with analysts predicting a decline in crude and an increase in gasoline stocks.
Overall, the impact of China’s monetary policy shift and the ongoing trade tensions on oil prices is a key factor for investors to monitor in the coming weeks.
Analysis: China’s decision to loosen monetary policy has boosted oil prices, but market participants remain cautious. Investors should keep an eye on the impact of this policy shift and trade tensions on oil prices moving forward.