Oil prices rose modestly on Tuesday as markets focused on increased Chinese demand and potential European supply tightness for the winter. Brent crude settled at $72.19 per barrel, up 5 cents (0.07%), while U.S. West Texas Intermediate closed at $68.59, gaining 22 cents (0.32%). This followed more than 1% gains for both benchmarks on Monday.
China’s plans to adopt “appropriately loose” monetary policy in 2025, coupled with an annual rise in crude imports for the first time in seven months, supported prices. However, analysts attributed the import growth to stockpiling rather than improved demand, emphasizing the need for stronger consumer confidence and spending to spur economic recovery.
In Europe, hedge funds are positioned for potential winter supply constraints, further bolstering oil prices. Meanwhile, geopolitical risks eased as Syrian rebels began forming a new government after ousting President Bashar al-Assad, reducing fears of regional instability affecting oil supply.
Market participants are also eyeing the U.S. Federal Reserve’s anticipated interest rate cut later this month, which could stimulate economic activity and boost oil demand. However, traders remain cautious ahead of inflation data that could influence the Fed’s decision.