Commodities
Oil prices rise in thin pre-Christmas trade
By Paul Carsten
LONDON (Reuters) -Oil prices rose on Tuesday, reversing the prior session’s losses, buoyed by a slightly positive market outlook for the short term, despite thin trade ahead of the Christmas holiday.
futures were up 36 cents, or 0.5%, at $72.9 a barrel, and U.S. West Texas Intermediate crude futures rose 34 cents, also 0.5%, to $69.58 a barrel by 1213 GMT.
FGE analysts said they anticipated the benchmark prices would fluctuate around current levels in the short term “as activity in the paper markets decreases during the holiday season and market participants stay on the sidelines until they get a clearer view of 2024 and 2025 global oil balances.”
Supply and demand changes in December have been supportive of their current less-bearish view so far, the analysts said in a note.
“Given how short the paper market is on positioning, any supply disruption could lead to upward spikes in structure,” they added.
Some other analysts also pointed to signs of greater oil demand over the next few months.
“The year is ending with the consensus from major agencies over long 2025 liquids balances starting to break down,” said Neil Crosby, Sparta Commodities’ assistant vice-president of oil analytics, in a note.
“The EIA’s short-term energy outlook (STEO) recently shifted their 2025 liquids to a draw, despite continuing to bring back some OPEC+ barrels next year.”
A plan by China, the world’s biggest oil importer, to issue 3 trillion yuan ($411 billion) worth of special treasury bonds next year, as Beijing ramps up fiscal stimulus to revive a faltering economy, was also supportive for prices.
That is likely to provide near-term support for WTI crude at $67 a barrel, said OANDA senior market analyst Kelvin Wong.
Markets will also be keeping an eye on the economy of the United States, the world’s largest oil consumer, which released a mixed bag of data overnight.
New orders for key U.S.-manufactured capital goods surged in November amid strong demand for machinery, while new home sales also rebounded, suggesting the U.S. economy was on a solid footing as the year closes out.
Commodities
Oil prices ease on surplus concerns, dollar strength
By Nicole Jao
NEW YORK (Reuters) -Oil prices edged lower on Monday in thin trade ahead of the Christmas holiday on concerns about a supply surplus next year and a strengthened dollar.
futures settled down 31 cents, or 0.43%, at $72.63 a barrel. U.S. West Texas Intermediate crude futures fell 22 cents, or 0.32%, to $69.24 a barrel.
Macquarie analysts projected a growing supply surplus for next year, which will hold Brent prices to an average of $70.50 a barrel, down from this year’s average of $79.64, they said in a December report.
Concerns about European supply eased on reports the Druzhba pipeline, which sends Russian and Kazakh oil to Hungary, Slovakia, the Czech Republic and Germany, has restarted after halting on Thursday due to technical problems at a Russian pumping station.
The U.S. dollar was hovering around two-year highs on Monday morning, after hitting that milestone on Friday.
“With the U.S. dollar changing from weaker to stronger, oil prices have given up earlier gains,” UBS analyst Giovanni Staunovo said.
A stronger dollar makes oil more expensive for holders of other currencies.
On Friday, U.S. data that showed cooling inflation helped alleviate concerns after the Federal Reserve interest rate cut last week.
“With the Fed sending mixed signals and some of these economic data points not being all that robust, the market is listless,” said John Kilduff, partner at Again Capital in New York.
Brent futures fell by around 2.1% last week, while WTI futures lost 2.6%, on concerns about global economic growth and oil demand after the U.S. central bank signalled caution over further easing of monetary policy.
Research from Asia’s top refiner Sinopec (OTC:) pointing to China’s oil consumption peaking in 2027 also weighed on prices.
U.S. President-elect Donald Trump on Friday urged the European Union to increase U.S. oil and gas imports or face tariffs on the bloc’s exports.
Trump also threatened to reassert U.S. control over the Panama Canal on Sunday, accusing Panama of charging excessive rates to use the Central American passage and drawing a sharp rebuke from Panamanian President Jose Raul Mulino.
Commodities
Gold prices edge up, remains pressured by strong dollar after hawkish Fed
Investing.com– Gold prices edged higher on Tuesday, extending their tepid performance as investors still remained cautious with the rising dollar following the U.S. Federal Reserve’s hawkish tilt.
Traders also refrained from placing large bets ahead of a shortened trading week due to the Christmas holiday.
inched up 0.2% to $2,616.95 per ounce, while expiring in February ticked up 0.2% to $2,633.89 an ounce.
The yellow metal had inched up 0.3% on Monday, after losing more than 1% in the previous week, reflecting uncertainty about the metal’s outlook.
Bullion under pressure on Fed rate outlook
Gold prices had hit a one-month low on Wednesday, as the Fed meeting indicated that rates will remain higher for a longer period after Wednesday’s cut.
Prices have failed to fully recover from it and have seen subdued moves as investors still assessed the implications of the Fed’s rate outlook.
Higher interest rates put downward pressure on gold as, as the opportunity cost of holding gold increases, making it more attractive compared to interest-bearing assets like bonds.
Traders are now expecting only two quarter-point reductions in 2025 amid continued economic resilience and still-elevated inflation. This compares to expectations of four rate cuts before the Fed meeting.
Strong dollar creates downward pressure on gold, other metals
The Fed’s hawkish shift provided renewed strength to the U.S. dollar, as higher interest rates make the greenback more attractive due to increased returns on dollar-denominated assets.
The rose 0.1% in Asia hours on Tuesday and hovered near a two-year high it reached last week.
A stronger dollar often weighs on gold prices as it makes the yellow metal more expensive for buyers using other currencies.
Other precious metals were largely muted. inched up 1.2% to $960.15 an ounce, while gained 0.3% to $30.265 an ounce.
Copper subdued on strong dollar, seasonal factors
Among industrial metals, copper prices were subdued and moved within tight ranges on Tuesday as a strong greenback weighed on the red metal.
Analysts attributed the weakness in copper to seasonal sluggishness as industrial production and construction projects often slow down as businesses and projects prepare for year-end closures and holidays.
Benchmark on the London Metal Exchange were largely unchanged at $8,954.50 a ton, while one-month were 0.5% higher at $4.1045 a pound.
Commodities
Oil prices rise; supply, demand concerns in focus for 2025
Investing.com– Oil prices rose Tuesday, but stuck to a tight trading range as traders remained uncertain over a potential supply glut and softening demand in the coming year.
At 11:58 ET (17:58 GMT), rose 1.1% to $73.44 a barrel, and rose 1.2% to $70.03 a barrel.
Trading volumes were thin ahead of the Christmas holiday, while strength in the dollar also weighed on oil prices after the Federal Reserve signaled a slower pace of rate cuts in 2025.
Oil nurses losses in 2024 as demand jitters weigh
and WTI prices were down about 5% so far in 2024, with persistent concerns over slowing demand in China being a key point of pressure.
Chinese oil imports steadily dropped this year as the world’s largest oil importer struggled with slowing economic growth. While the country did outline plans to ramp up fiscal spending and stimulus measures in the coming year, markets were still holding out for more clarity on the planned measures.
Increased electric vehicle adoption in China also undermined fuel demand in the country.
Both the OPEC and the IEA have forecast slower demand growth in 2025 due to slowing demand in China. The country is also expected to face increased economic headwinds from a renewed trade war with the U.S. under Donald Trump.
Supply uncertainty spurs caution; US inventory data awaited
Oil markets were on edge over a potential supply glut in 2025. While the OPEC recently agreed to extend its ongoing supply cuts until at least mid-2025, production elsewhere could potentially increase.
US oil production remained close to record highs, and could potentially increase in the coming year, especially as Trump vowed to ramp up domestic energy production.
US inventory data, from the , is due later Tuesday and is set to offer more cues on oil production and supply.
(Peter Nurse contributed to this article.)
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