- Crude oil extended the week's recovery.
- Weekly US API crude oil values will be released later.
- Energy markets expect a boost from Chinese demand.
U.S. West Texas Intermediate (WTI) crude oil hit fresh all-time highs on Tuesday, extending the week's technical rally, as energy markets ride on expectations of a rebound in Chinese crude oil, after post-trade surges. Holidays will cause an increase in crude oil purchases.
Post-Lunar New Year travel was much higher than expected in the last half of February, causing Chinese crude oil inventories to decline faster than expected and raising the rate of purchases by Chinese refiners. Rising post-holiday crude oil spending and consumption in China has raised hopes in markets that Chinese demand for barrels remains high enough to absorb the additional capacity.
Maintenance shutdowns are also planned this year in mainland China, where the reduction in refining capacity is expected to reach its highest level in three years, further limiting the supply of refined petroleum products within China.
Chinese demand picks up, US API crude oil values expected
The American Petroleum Institute (API) releases its latest weekly U.S. crude oil stock figures, showing a 7.8 million barrel increase in excess barrels floating in U.S. crude oil supply chains.
Energy markets are also shrugging off renewed expectations of a potential cessation of hostilities in the ongoing Gaza conflict between Israel and Palestinian Hamas. Oil traders remain concerned about the possibility of the dispute spreading to nearby crude oil-focused economies, with the risk of supply chain disruptions in the Middle East.
WTI rose again to the $78.00 area, and on Tuesday tested $78.20 per barrel. US crude oil extended a rebound from Friday's low near $75.80, and WTI continues to flounder within a rough consolidation between $78.40 and $76.00.
WTI remains stuck at the 200-day SMA near $77.65, and near-term bullish momentum remains limited below the late-January high at $79.20.
WTI hourly chart
WTI daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
