Prices could receive additional support now from the latest GDP data from China, which showed the country hit its target for 2024, at 5%, versus analyst expectations of 4.9% growth. Even with forecasts about peak demand for crude oil, China’s economy is still dependent on hydrocarbons, meaning the news is bullish for crude.
Crude oil prices moved higher today, after the U.S. Energy Information Administration reported an inventory dip of 2 million barrels for the second week of the year.
Oil surpassed $80 a barrel for the first time since August as US inventories tightened and fresh sanctions on Russia began to affect crude flows.
The two-day oil price rally on Friday and Monday following the latest U.S. sanctions on Russia’s oil exports goes to show that geopolitics will continue to play a key role in oil price action and market balances this year.
The European Union’s top diplomat Kaja Kallas said Ukraine’s allies should work toward lowering the price cap on Russian oil in order to deprive the Kremlin of revenue.
He highlighted the financial challenges during his vetting by Parliament’s Appointments Committee on Monday, January 13, 2025.
Seplat Energy Plc has unveiled plans to increase its crude oil production by 140% to 120,000 barrels per day. The company’s Chief Financial Officer, Eleanor Adaralegbe, revealed in an interview with the Financial Times that they would increase output from the present 50,000 bpd to 120,000 bpd in H1 2025.
Oil and gas will remain crucial to the global energy mix for the foreseeable future despite the growth of renewables. Oil demand is expected to peak within the next decade, but projections indicate that more than half of today’s oil consumption – of around 105 million barrels per day – will persist until 2050. This enduring demand provides stability for NOCs, but they must navigate a market shaped by price volatility, geopolitical shifts and growing pressure to decarbonize.
Iran’s output, which hit the highest since 2018 last year despite U.S. sanctions, fell by 70,000 bpd, the survey found. It may soon be curbed by tighter sanctions from the administration of incoming U.S. President Donald Trump, Goldman Sachs and other analysts have forecast.
Crude oil and gasoline prices today are climbing, with crude oil posting a 2-1/2 month high and gasoline posting a 6-week high. Signs of US economic strength support energy demand and crude prices after weekly jobless claims fell to an 8-month low, and the Dec S&P manufacturing PMI was revised higher. Also, strong US jet fuel demand is bullish for crude after US jet fuel demand in October rose to a 7-year monthly high. Crude prices fell back from their best levels after the dollar index (DXY00) rallied to a 2-year high, and weekly US EIA crude inventories fell less than expected.