WTI starts 2025 with a bullish movement driven by economic expectations – London Business News | Londonlovesbusiness.com

The price of West Texas Intermediate (WTI) crude oil saw a slight increase at the start of 2025, climbing above $72 per barrel.

This bullish movement marked the beginning of a year with optimistic prospects for the oil market, driven by economic and geopolitical factors.

The optimism surrounding China’s economy, the world’s largest crude importer, is a key factor behind this uptrend.

President Xi Jinping’s statements promising more proactive policies to stimulate growth have raised expectations of increased energy demand. While recent data indicates marginal growth in the country’s manufacturing activity, sectors such as services and construction have started showing signs of recovery, suggesting a gradual strengthening of China’s economy.

At the same time, crude inventories in the United States have played a significant role in price movements. During the last week of December, a decline in crude and distillate stocks was reported, reflecting robust consumption. However, gasoline inventories rose, indicating a potential adjustment in consumption patterns. These inventory fluctuations highlight the market’s complexity and sensitivity to supply and demand conditions.

According to data published by the EIA on Tuesday, U.S. crude demand reached levels unseen since before the pandemic, hitting 21.01 million barrels per day in October. This increase underscores the country’s economic recovery and its impact on the global energy market. Additionally, U.S. crude production hit a record high of 13.46 million barrels per day, demonstrating the country’s ability to meet rising domestic and international demand.

On the international front, the Organization of the Petroleum Exporting Countries and its allies (OPEC+) face the challenge of balancing the market. Despite efforts to control supply, increasing global production could cap price gains. Moreover, moderate demand, particularly from China, raises questions about how the market will evolve in the medium term.

While WTI crude prices have started the year positively, many analysts predict that prices could remain around $70 per barrel throughout 2025. This reflects a stabilization trend following the declines seen in recent years. Market players remain attentive to global economic developments, the energy policies of major producers, and supply-demand dynamics.

In conclusion, the bullish movement in WTI prices at the start of 2025 underscores the interconnectedness of global economic factors and the oil market. Expectations of economic improvement in China, combined with strong U.S. demand, are creating an optimistic outlook. However, structural challenges such as rising supply and moderate demand in key markets suggest that volatility could remain a central theme for the sector throughout the year.