Oil prices rose slightly on Tuesday, driven by instability in the Middle East and China’s economic stimulus measures. However, concerns over global growth, U.S. tariffs, and Russia-Ukraine ceasefire talks capped gains.
Brent crude futures climbed by 17 cents, or 0.2%, to $71.24 per barrel by 0350 GMT. U.S. West Texas Intermediate (WTI) crude rose 14 cents, or 0.2%, to $67.72 per barrel.
ING analysts noted that factors such as U.S. strikes on Yemen’s Houthis helped support the market. They also pointed to China’s new plans to revive consumption, along with better-than-expected retail sales and fixed asset investment growth.
China’s State Council unveiled a special plan to boost domestic consumption, including measures like increasing incomes and providing childcare subsidies. Recent data showed strong retail sales growth for January and February, though factory output declined and urban unemployment hit a two-year high.
Chinese crude oil throughput grew by 2.1% in January and February, boosted by a new refinery and increased holiday travel.
Prices also gained momentum from President Trump’s vow to continue U.S. actions against Yemen’s Houthis unless they stop targeting ships in the Red Sea. Meanwhile, Israeli air strikes in Gaza killed at least 200 people, as violence escalated following the collapse of a ceasefire extension.
Despite these factors, global demand concerns remained. The OECD warned that U.S. tariffs would reduce growth in North America, impacting global energy demand.
Westpac’s Robert Rennie cautioned that rising supply and trade tensions could drive prices lower, predicting oil would eventually settle in the mid-$60 range.
Venezuela’s state-run PDVSA revealed plans to continue producing and exporting oil from its Chevron joint venture, despite the expiration of the U.S. license next month.
Markets also focused on peace talks between Trump and Putin over the Ukraine war, with the potential easing of sanctions on Russia weighing on oil prices.