Oil futures rose, driven by technical momentum and positive market sentiment. After surpassing the 50-day moving average, oil prices found support at $69.11 per barrel. Speculation about China's new fiscal stimulus measures further boosted investor confidence. Reports suggest that China plans to issue special bonds worth 3 trillion yuan ($411 billion) to stimulate economic growth. As the largest oil importer, China's economic health significantly impacts global demand forecasts. Traders anticipate increased fossil fuel consumption as economic activity rebounds, adding another layer of support for oil prices.
In the U.S., declining inventories have also contributed to bullish sentiment. The American Petroleum Institute (API) reported a decrease of 3.2 million barrels in crude oil inventories. Market participants are awaiting confirmation from the U.S. Energy Information Administration (EIA), with expectations of a 1.9 million barrel reduction in crude oil stocks. Analysts also predict decreases in gasoline and distillate inventories.
The outlook remains bullish, supported by China's economic measures and U.S. inventory declines. Traders should monitor the EIA report for further confirmation, as a larger-than-expected decrease could drive prices higher. Key price levels and stimulus policies will influence short-term market direction, with $70 per barrel serving as a crucial support level. Any short-term pullbacks might present buying opportunities.
