WTI Rises to Near $71.50 as Manufacturing Sector in China Expands in December
West Texas Intermediate (WTI) Oil price extends its gains for the third successive day, trading around $71.40 per barrel during the Asian session on Tuesday. Crude Oil prices have maintained their gains following the release of the NBS Manufacturing Purchasing Managers' Index (PMI), which indicates that China's manufacturing sector expanded in December.
Factory output in China rose for the third consecutive month, though it slightly dipped to 50.1 in December, down from 50.3 in the previous report and below the market's expectation of 50.3. This data suggests that new stimulus measures are helping to support the economy of the world's largest crude Oil importer. Additionally, Chinese authorities have agreed to issue a record 3 trillion Yuan ($411 billion) in special treasury bonds in 2025 to boost economic growth, as reported by Reuters last week.
Oil prices could receive short-term support from a decline in US crude stockpiles, which are expected to have dropped by approximately 3 million barrels last week, per Reuters. However, a weak long-term demand outlook has put downward pressure on Oil prices. Traders are now awaiting US factory survey data for further insights into the demand outlook.
Meanwhile, Oil prices are poised for a modest annual decline of approximately 0.5%, after being stuck in a tight trading range for several months. As the market looks to the future, it anticipates a potentially turbulent year, driven by worries about an oversupply, geopolitical tensions, and the possible influence of the upcoming Trump administration on Oil policy, leading to a cautious sentiment.
Source : FXStreet
