Oil prices saw a notable rise on Monday, driven by strong industrial activity in China, the world’s second-largest oil consumer, alongside escalating tensions in the Middle East.
Brent crude futures rose by 75 cents, or 1.04%, reaching $72.59 per barrel, while U.S. West Texas Intermediate crude stood at $68.70 per barrel, up 70 cents, or 1.03%.
A strategist at UBS explained, “Positive economic data from China is providing strong support for oil prices, especially as the market has been concerned recently about Chinese demand.”
He also pointed out that “economic stimulus measures have started to positively impact economic activity, which should boost oil demand in China over the coming months.”
Additionally, a private-sector survey in China showed that factory activity expanded at its fastest pace in five months in November, bolstering optimism among Chinese firms at a time when U.S. President-elect Donald Trump continues his trade threats.
Last week, oil prices dropped by more than 3% due to reduced supply concerns amid Middle East tensions, along with surplus forecasts for 2025, despite continued production cuts.
Sources from OPEC and its allies (OPEC+) revealed that the meeting, originally scheduled for this week, has been postponed to December 5. They are discussing the possibility of delaying the planned production increase in January. This meeting will make crucial decisions regarding production policy for the early months of 2025.
Finally, a Reuters monthly oil price survey indicated that Brent crude is expected to average $74.53 per barrel in 2025.
