Lagos — Crude oil prices rose on Wednesday, buoyed by hopes of a breakthrough in U.S.-China trade negotiations, after a recent report citing sources close to the Chinese government suggested Beijing may return to the negotiating table.
Optimism was further supported by China’s stronger-than-expected Q1 GDP growth of 5.4%, surpassing both its 5% annual target and analyst expectations of 5.1%, signaling a potential support for oil demand.
Meanwhile, the latest Weekly Petroleum Status Report delivered mixed signals. US commercial crude inventories rose by 0.5 million barrels, slightly above the expected 0.4-million-barrel increase, though far below the previous week’s build of over 2.5 million. Inventories remain 6% below the five-year seasonal average, which could limit bearish pressure.
More notably, gasoline and distillate stocks posted sharp declines of 2.0 million and 1.9 million barrels, respectively, indicating robust end-user demand and offering fundamental support to prices.
However, crude oil imports declined by 189,000 barrels per day last week. Should this trend persist, oil-exporting American nations such as Canada, Brazil, Mexico, Venezuela, and Colombia could face fiscal pressure and currency weakness, especially if U.S. imports continue to soften.”
*Analysis by Quasar Elizundia, Expert Research Strategist – Pepperstone
