WTI Crude Oil Hits $71.88 as China Recovery Boosts Demand Outlook for 2025

Oil prices began 2025 on a positive note, with Brent crude rising by 0.06% to $74.82 per barrel and West Texas Intermediate (WTI) gaining 0.26% to $71.91 per barrel in early Thursday trading.

The gains follow a 3% decline in 2024, marking the third consecutive year of losses, driven by weak demand from China and rising global oil supplies.

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China’s President Xi Jinping pledged more proactive growth policies in 2025, a statement that has energized traders hoping for increased fuel demand. Manufacturing data released on Thursday showed moderate activity growth in December, signaling policy stimulus benefits but also highlighting concerns about trade risks.

The private-sector Caixin/S&P Global survey mirrored official manufacturing data from earlier in the week, which indicated limited growth but a rebound in services and construction.

Geopolitical Risks and Economic Data in Focus

Investors are closely watching geopolitical tensions and upcoming U.S. economic indicators. President-elect Donald Trump’s proposed tariffs and aggressive economic policies add to the uncertainty. Market analysts, including Tony Sycamore of IG Markets, note that the U.S. ISM Manufacturing data, set to be released on Friday, could dictate crude oil’s next moves.

Meanwhile, U.S. crude demand has surged, reaching 21.01 million barrels per day (bpd) in October, the highest level since the pandemic, according to Energy Information Administration (EIA) data. Crude output also hit a record 13.46 million bpd, up by 260,000 bpd from September.

Weekly U.S. oil inventory data, delayed due to the New Year holiday, is expected to show a decline in crude and distillate stockpiles, while gasoline inventories are projected to rise.

2025 Oil Market Outlook

Analysts predict oil prices will likely hover near $70 per barrel throughout 2025. A Reuters poll indicates weak Chinese demand and growing global supplies will offset efforts by OPEC+ to stabilize the market.

Europe, meanwhile, is navigating energy challenges as Russia halted gas exports via Soviet-era pipelines on January 1. While the move was anticipated, EU consumers are shielded by alternative supply arrangements, including Hungary’s continued gas imports through the TurkStream pipeline.

Daily Technical Outlook: WTI Crude Oil

WTI Crude Oil is trading at $71.88, supported by bullish momentum following a breakout from a symmetrical triangle pattern. The 4-hour chart highlights immediate resistance at $72.81, with further barriers at $73.75 and $74.75. Key support levels include $70.50, $69.33, and $68.46.

The RSI at 65.21 suggests strong bullish momentum but flags potential overbought conditions. The 50-day EMA at $70.28 reinforces the upward trend. Traders should monitor $72.81 as a critical resistance level, as a sustained break above could drive further gains.

Key Insights

  • Resistance Levels: Immediate resistance at $72.81; next at $73.75 and $74.75.

  • Support Zones: Key support at $70.50; further levels at $69.33 and $68.46.

  • Indicators: RSI at 65.21 suggests bullish momentum; 50 EMA at $70.28 strengthens trend.

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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