Crude oil futures have found support, driven by expectations of stronger demand in China following Beijing’s announcement of new measures to support the economy in 2025.
While past efforts have focused on sectors like electric vehicles and infrastructure, there are expectations that China may shift toward policies to boost consumer spending.
This has sparked optimism in the oil market, with traders hopeful that these initiatives could drive higher oil consumption in the world’s largest crude importer.
However, upward momentum remains constrained as market participants await more clarity on China’s stimulus plans. While November’s 14% year-on-year increase in Chinese crude imports added to the optimism, there are concerns that the announcement lacked concrete details and may not be enough to sustain price gains. This uncertainty is likely to limit any significant upside for global crude prices.
Meanwhile, in the U.S., rising crude and fuel inventories suggest ample supply, which could also cap price gains. According to data from the American Petroleum Institute, crude oil stocks rose by 499,000 barrels last week, along with increases in gasoline and distillate stocks. This rise in stockpiles could dampen demand expectations. Oil prices could remain volatile as markets await further insights from the U.S. EIA’s crude oil inventories data and upcoming U.S. inflation figures.
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