By Scott DiSavino
NEW YORK (Reuters) – Oil prices eased about 1% in volatile trade on Monday following some weak economic news from the U.S. and Germany.
Earlier in the day, crude prices were on track to close at 12-week highs on support from a weaker U.S. dollar and as a winter storm boosted demand for energy to heat U.S. homes and businesses.
After rising for five days in a row, Brent futures fell 35 cents, or 0.5%, to $76.16 a barrel by 2:01 p.m. EST (1901 GMT), while U.S. West Texas Intermediate (WTI) crude fell 56 cents, or 0.8%, to $73.40.
Those declines pushed both crude benchmarks out of technically overbought territory for the first time in three days.
On Friday, Brent settled at its highest since Oct. 14 and WTI closed at its highest since Oct. 11 due in part on expectations of more fiscal stimulus to revitalise China’s faltering economy.
With interest in energy trade growing in recent weeks, open interest in WTI futures on the New York Mercantile Exchange soared to 1.933 million contracts on Jan. 3, the most since June 2023.
“Oil markets have entered 2025 with balanced supply-and-demand fundamentals, but with prices being propped up by enduring geopolitical tensions,” analysts at Eurasia Group, a consultancy, said in a report.
“As the year progresses, oil markets will probably continue to experience low demand growth that may be outpaced by new supply, especially from the U.S. and likely OPEC as well,” Eurasia Group said.
In the U.S., the world’s biggest economy, new orders for manufactured goods fell in November amid weakness in demand for commercial aircraft while business spending on equipment appeared to have slowed in the fourth quarter, according to data from the Commerce Department’s Census Bureau.
In Germany, Europe’s biggest economy, annual inflation rose more than forecast in December due to higher food prices and a smaller drop in energy prices than in previous months.
To combat higher inflation, central banks usually boost interest rates, which can slow economic growth and demand for energy.
CRUDE PRICES WERE UP
Earlier in the day, crude prices were up as a winter storm marches across the U.S., causing prices for natural gas, a heating fuel, to spike by as much as 11% on Monday. [NGA/]
Crude prices also gained ground earlier in the session on a 1.1% slump in the U.S. dollar against a basket of other currencies following a newspaper report that President-elect Donald Trump was mulling tariffs that would only be applied to critical imports, potentially a relief for countries that were expecting broader levies.
The dollar, however, pared much of that decline after Trump denied the newspaper report.
A weaker U.S. currency makes dollar-priced commodities like oil cheaper for buyers using other currencies.
In China, the world’s second-biggest economy, the yuan ended the domestic session at its weakest level in 16 months against the U.S. dollar, weighed down by trade concerns.
In a sign of firmer demand expectations, Saudi Aramco, the world’s top oil exporter, raised crude prices for Asian buyers in February for the first time in three months.
Sudan, meanwhile, lifted a nearly year-long force majeure on the transport of crude oil from its neighbour South Sudan to a port on the Red Sea after security conditions improved.
(Reporting by Scott DiSavino in New York and Ahmad Ghaddar in London; Additional reporting by Florence Tan and Siyi Liu in Singapore; Editing by David Goodman, Rod Nickel and Cynthia Osterman)
A perfectly cooked terracotta potato is a satisfactory side or even a main dish, depending…
Washington (AP) - like Stock markets fall The day after the president Donald Trump's radical…
Donald Trump said he would sign an executive decree to extend the deadline for Tiktok's…
Lamar Jackson's desire to win the battle of the famous n ° 8 is underway.Last…
In a revolutionary discovery, archaeologists have discovered Traces of an old garden Under the church…
Russell Brand responds to recent accusations following allegations that he has sexually violated and attacked…