Oil prices began the 2025 trading year with a rise in Asia on Thursday as market sentiment turned positive on expectations of stronger economic and oil demand growth.
Oil prices have been rangebound for most of the fourth quarter amid concerns about demand in China and other major economies and expectations of an oversupply this year.
For 2024, oil saw a second consecutive year of annual declines, falling by about 3% compared to the last closing price of 2023.
On Thursday, the first trading day of 2025, oil was up by half a percentage in Asian trade as the market digested signals that China would introduce additional measures to boost its economic growth this year.
The U.S. benchmark, WTI Crude, was trading 0.43% higher at $72.04 in early Asian trade.
Brent Crude, the international benchmark, was up 0.42% at $74.97 per barrel.
China is set to be more proactive in measures to boost economic growth in 2025, Chinese President Xi Jinping said in his New Year’s address.
In a separate speech, Xi also suggested that China would meet its official 2024 economic growth target of 5%.
Official oil consumption data from the United States also boosted positive market sentiment.
Earlier this week, data from the Energy Information Administration (EIA) showed that America’s total oil demand hit 21.01 million barrels per day (bpd) in October 2024. This was the highest volume of total crude oil and petroleum products supplied – a proxy for demand – since the pandemic, and a jump of about 700,000 bpd compared to September 2024.
Later on Thursday, the market and traders will be watching the EIA weekly crude and fuels inventory report for additional insights.
“With a balance between supply discipline and economic recovery, crude oil prices are poised for a potential recovery driven by geopolitical and economic factors,” Axis Securities says in a note on oil prices, as carried by The Wall Street Journal.
By Tsvetana Paraskova for Oilprice.com