Oil up slightly: Yemen, China offset growth fears
Shafaq News/ Oil prices roseslightly on Tuesday, supported by instability in the Middle East as well asChina's stimulus plans and data, although global growth concerns, U.S. tariffsand Russia-Ukraine ceasefire talks curbed gains.
Brent futures ticked up 17cents, or 0.2%, to stand at $71.24 a barrel by 0350 GMT, while U.S. West TexasIntermediate crude futures rose 14 cents, or 0.2%, to $67.72 a barrel.
“Along with U.S. strikes on the Houthis inYemen, several factors provided support to the market,” ING analysts said in aresearch note.
“China unveiled plans torevive consumption, while Chinese retail sales and fixed asset investmentgrowth came in stronger than expected.”
The state council, or cabinet,unveiled on Sunday a special action plan to boost domestic consumption, withmeasures such as boosting incomes and offering childcare subsidies.
On Monday, Chinese economicdata showing that retail sales growth quickened in January-February also gaveinvestors reasons for optimism, although factory output fell and the urbanjobless rate reached its highest in two years.
Crude oil throughput in China,the world's biggest crude importer, rose 2.1% in January and February from ayear earlier, supported by a new refinery and holiday travel, official datashowed on Monday.
Prices also gained supportfrom President Donald Trump's vow to continue the U.S. assault on Yemen'sHouthis unless they end their attacks on ships in the Red Sea.
On the Israel-Palestinianconflict, Israeli air strikes in Gaza killed at least 200 people, Palestinianhealth authorities said, as attacks on Tuesday ended a weeks-long standoff overextending a ceasefire that halted fighting in January.
Highlighting persistentconcerns about demand, a key downside risk for oil, the OECD said on Mondaythat Trump's tariffs would drag down growth in the United States, Canada andMexico, which would weigh on global energy demand.
"With global supplysurging and tariffs and trade wars set to hit global demand, we remain of theview that prices will head lower and eventually reach the mid $60s," saidRobert Rennie, head of commodity and carbon strategy at Westpac.
Further adding to globalsupply, Venezuela's state-run PDVSA has put together three operational scenariosindicating it plans to continue producing and exporting oil from its jointventure with Chevron after the U.S. major's licence expires next month,according to a company document reviewed by Reuters on Monday.
Talks on Tuesday between Trumpand Russian President Vladimir Putin about ending the Ukraine war were also infocus.
Markets believe a potentialpeace negotiation would involve the easing of sanctions on Russia and thereturn of its crude supply to global markets, weighing on prices.
(Reuters)
