(Reuters) – Oil prices rose on Wednesday on expectations of steady demand in the U.S. and China, the world’s two largest oil users, amid an improving economic outlook.
Brent crude futures rose 29 cents, or 0.42%, to $69 a barrel by 0105 GMT. U.S. West Texas Intermediate crude futures were up 40 cents, or 0.6%, at $66.92.
That reversed two days of declines as the market downplayed the potential for supply disruptions after U.S. President Donald Trump threatened tariffs on purchases of Russian oil.
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Prices have seesawed in a fairly tight range as signs of steady demand from an increase in travel during the Northern Hemisphere summer has competed with concerns U.S. tariffs on its trading partners will slow economic growth and fuel consumption.
However, major oil producers are pointing to improvement in economic growth for the second half of the year and Chinese data showed growth there remained consistent.
“Strong seasonal demand is currently providing upward momentum to oil prices, as summer travel and industrial activity peak,” LSEG analysts said in a note.
“Increased gasoline consumption – especially in the U.S. during the Fourth of July holiday period – has signaled robust fuel demand, helping offset bearish pressures from rising inventories and tariff concerns.”
China data showed growth slowed in the second quarter, but not by as much as previously feared, in part because of frontloading to beat U.S. tariffs. That eased some concerns about the economy of the world’s largest crude importer.
The data also showed that China’s crude oil throughput in June jumped 8.5% from a year earlier, indicating stronger fuel demand. That was the highest since September 2023, as state-owned refineries increased operations and saw a recovery in profit, consultants said.
Additionally, the Organization of Petroleum Exporting Countries (OPEC) forecast in a monthly report on Tuesday that the global economy would do better in the second half of the year, boosting the oil demand outlook.
India, China and Brazil are outperforming expectations while the U.S. and EU are recovering from last year, the report said.
Reporting by Colleen Howe; Editing by Christian Schmollinger
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