WTI price drifts higher to near $67.30 in Tuesday’s early Asian session.
Geopolitical risks and China's plans to boost consumption support the WTI price.
Concerns over the impact of Trump’s tariff policies might cap the WTI’s upside.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $67.30 during the early Asian session on Tuesday. The WTI price extends the rally as the United States (US) vows to continue attacks on Houthis.
The Houthis announced on Sunday that they launched an attack comprising 18 ballistic and cruise missiles as well as drones, targeting the USS Harry S Truman aircraft carrier and its accompanying warships in the northern Red Sea. A Houthi military spokesman said that the attack was in reaction to US airstrikes authorized by Trump against rebel-controlled areas in Yemen, including the capital Sanaa and the province of Saada, which borders Saudi Arabia.
US President Donald Trump said on Monday he would hold Iran responsible for any attacks carried out by the Houthi group that it backs in Yemen. This comes as Trump’s administration expanded the largest military operation in the Middle East since his return to the White House. The Red Sea disturbance has caused an increase in energy transportation prices and the WTI price, as oil and gas cargo shipments were forced to take longer routes.
A slew of positive Chinese economic data as well as a special plan from Chinese officials to boost domestic consumption contribute to the WTI’s upside. On Sunday, China launched special initiatives to boost consumption and raise incomes Other measures include stabilizing the stock and property markets. China’s Retail Sales rose 4% in the first two months of this year, compared to a 3.7% increase in December.
On the other hand, darkened economic outlooks amid an escalating global trade war from Trump's protectionist trade policies could exert some selling pressure on the black gold. Trump's aggressive tariffs on imports are expected to raise prices for businesses, boost inflation and undermine consumer confidence in a blow to economic growth.
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