- The WTI price can recover land as the oil demand decreases the pressure related to tariffs amid the relaxation of commercial tensions between the US and China.
- The strongest data on employment in the US relieved concerns about an economic deceleration, supporting oil demand.
- Citigroup hopes that the Fed will implement rate cuts of 25 basic points in September, October and December.
The price of oil West Texas Intermediate (WTI) stopped its two -day winning streak, quoting around $ 63,90 per barrel during the European hours on Monday. However, oil prices gained ground as the global oil demand recovered from the pressure related to tariffs amid the relaxation of commercial tensions between the United States (USA) and China.
The president of the USA, Donald Trump, said he had a phone call of an hour and a half with the Chinese president, Xi Jinping, on Thursday, which resulted in a very positive conclusion for both countries. From the Trump administration, the Treasury Secretary, Scott Besent, the secretary of Commerce, Howard Lutnick, and the commercial representative, Jamieson Greer, are scheduled to meet with their Chinese counterparts in London on Monday.
On Friday, the US non -agricultural payrolls published 139,000 new jobs added in non -agricultural businesses in May, exceeding the 130,000 market consensus. In addition, the unemployment rate remained stable at 4.2% and the average income per hour remained unchanged at 3.9%, both readings were stronger than expected by the market.
The US labor market data more solid than expected for May indicated underlying resistance in the labor market. These figures relieved concerns about an economic deceleration and supported the oil demand.
In addition, Citigroup, on Monday, predicted that the Federal Reserve (FED) will deliver a rate cut of 25 basic points each in September, October and December. The firm also expects the Central Bank to cut a quarterfinal each in January and March 2026. This dovish perspective on the Fed could provide support for oil prices, since lower interest rates can improve economic activities in the US, the world’s largest oil consumer in the world.
WTI FAQS oil
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
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.
