WTI prices post their first monthly gain since September amid the ongoing Middle East geopolitical conflict.
IEA said that global oil demand will likely increase by 2mb/d in 2024.
A surprise build in US crude inventories dragged WTI prices lower.
Oil traders will monitor the Chinese Caixin Manufacturing PMI data on Thursday.
Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $76.25 after bouncing off the weekly lows of $75.43 on Thursday. WTI prices snap the three-month losing streak amid the ongoing geopolitical tensions in the Middle East, keeping global crude supply risks elevated.
The International Energy Agency (IEA) Executive Director, Fatih Birol, said that global oil demand will likely increase by 2 mb/d in 2024, similar to the growth achieved in 2023. He further stated that demand will keep rising until at least 2030. Additionally, the rising Middle East geopolitical tensions highlight the potential risk to crude supplies in the region, which lifts WTI prices.
On the other hand, the upside of WTI prices might be limited due to the disappointing Chinese Manufacturing PMI data. On Wednesday, China’s NBS Manufacturing PMI came in at 49.2 in January versus 49.0 prior, below the market consensus of 49.2. Manufacturing activity in China contracted for a fourth straight month in January, which exerts some selling pressure on WTI prices as China is the leading crude importer in the world.
Apart from this, a surprise build in US weekly crude inventories dragged WTI lower on Wednesday. Inventories of US crude unexpectedly rose by 1.23M barrels for the week ended January 29 from the previous week's 9.233M barrels decline, compared with market expectations for a 217K barrel draw, according to the Energy Information Administration
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