Oil prices rise as geopolitical tensions persist and demand from China is expected to improve
Oil prices rose today, supported by continued global geopolitical tensions and expectations of improved demand from China, the world's largest oil importer, boosting investor appetite in energy markets.
US-Venezuela tensions support prices
Oil benefited from escalating tensions between the United States and Venezuela, with prices posting notable gains during early Asian trading.
Traders fear that these tensions could lead to potential supply disruptions, which supports crude prices in the short term.
China boosts hopes of improving demand
On the demand side, the Chinese government has announced plans to increase government spending through 2026, in a clear sign of continued support for economic growth.
This is seen as a positive factor that could boost the consumption of oil and petroleum products in the coming period.
Brent and West Texas crude prices rise
Brent crude rose 1.5% to $61.50 per barrel, while West Texas Intermediate crude rose 1.7% to $57.90 per barrel, amid cautious optimism in the markets.
Additional geopolitical developments increase uncertainty
U.S.-Ukraine talks on ending the war with Russia did not produce a clear agreement, despite U.S. President Donald Trump's statements that there has been significant progress in peace talks with Ukrainian President Volodymyr Zelensky, while emphasizing that a final agreement could take several weeks.
Following a phone call with Russian President Vladimir Putin and a meeting with the Ukrainian president, President Trump did not provide sufficient details on the mechanics of reaching an agreement, keeping geopolitical uncertainty in the markets.
Outlook
Oil prices are expected to remain supported in the coming period as geopolitical tensions persist, along with any further signs of improving global demand, especially from China, which could keep market volatility high through the end of 2025.
