FX.co ★ Oil Gains on Demand Optimism

On Thursday, WTI crude oil futures climbed towards $67 per barrel, breaking a three-day downward trend. This rebound was fueled by positive economic reports from key oil-consuming nations and indications of reduced trade tensions. In the United States, recent data reflected improved economic activity, although the overall outlook was tempered with a neutral to slightly cautious stance due to price pressures from tariffs. Concurrently, China's second-quarter growth decelerated less than anticipated, buoyed by accelerated activity before US tariffs took effect. Enhancing the demand perspective, the EIA reported a 3.9 million barrel decrease in US crude stockpiles, although this was offset by larger-than-expected increases in gasoline and diesel supplies. Additionally, China's crude processing surged by 8.5% year-on-year in June. The easing of US-China trade tensions further supported the market, highlighted by the lifting of the AI chip ban and a trade agreement with Indonesia. President Trump also expressed optimism regarding prospective trade deals with India and Europe. Nonetheless, risks associated with tariffs continue to pose challenges to demand.