WTI price dips slightly despite an improved demand outlook, supported by upbeat economic data from major consumers.
The latest Fed Beige Book indicates that overall business activity saw a slight increase from late May through early June.
China’s economy slowed in the second quarter, but the deceleration was less severe than expected.
West Texas Intermediate (WTI) Oil price extends its losing streak for the fourth successive day, trading around $65.30 during the European hours on Thursday. However, crude Oil prices gained ground due to upbeat economic data, released recently from the largest Oil consumers.
The latest Fed Beige Book shows that overall business activity increased slightly from late May through early June. The report mentioned that inflation pressures are relatively subdued, but underlying cost pressures are building, and business operators remain cautious. However, the outlook was neutral to slightly pessimistic, as only two districts expected activity to increase, and others foresaw flat or slightly weaker activity.
Meanwhile, data from China showed that economic growth slowed in the second quarter, but not as sharply as feared, partly due to front-loading ahead of US tariffs. This helped ease concerns about the health of the world’s largest crude Oil importer. Additionally, China’s crude Oil throughput rose 8.5% year-over-year in June, suggesting stronger crude demand.
Additionally, Oil prices may gain ground amid easing trade tensions between the United States (US) and China following US President Donald Trump’s lifting the ban on the sale of AI chips to China, along with the announcement of a trade deal with Indonesia. Trump also expressed optimism about potential trade agreements with India and Europe, Reuters cited John Paisie, president of Stratas Advisors.
Oil prices gained ground as the US Energy Information Administration (EIA) reported that crude inventories fell by 3.859 million barrels in the week ending on July 11, surpassing the expected decline of 1.8 million barrels. However, gains were limited by larger-than-expected gasoline and diesel inventories.
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