Fuel prices are high; Set for weekly losses on Trump’s energy plans By Investing.com
Investing.com–Oil prices rose on Friday, helped by better-than-expected economic activity in China, but were in a weekly decline as President Donald Trump called for lower crude prices and higher U.S. energy output.
At 08:35 ET (13:35 GMT), March futures rose 0.5% to $78.70 a barrel, having gained 0.4% to $74.95 a barrel.
Both contracts were trading 3% lower this week – their worst performance since November.
PMI data, in focus
Oil markets were helped on Friday after data showed China’s services sector expanded at its fastest pace in seven months in December, helped by strong domestic demand.
It came in at 52.2 in December, compared to expectations for a 51.4 publication. The reading was higher than the 51.5 seen in November, and points to an expansion above the 50 level.
China is the world’s largest crude importer, and traders are looking for signs of improvement in the Chinese economy from the fourth quarter, following major stimulus measures from Beijing.
The Chinese Lunar New Year holiday also begins next week, heralding a surge in travel demand in the country.
Data out of Europe also helped the volume, which later, compiled by S&P Global, rose to 50.2 in January, indicating that Eurozone business is starting the new year with a return to growth.
Beyond China, the focus is also on next week, when the central bank is widely expected to hold interest rates steady after cutting interest rates to 1% from 2024.
Oil hit by Trump’s energy policies
Oil prices were rejected by Trump this week to increase energy production in the United States, the president declared a national emergency on the issue.
Trump signed an executive order calling for an increase in US oil production, while easing climate-related restrictions on the energy sector.
Trump also called on Saudi Arabia and the Organization of the Petroleum Exporting Countries to cut oil prices, which led to further losses in the crude market.
“President Trump has been very vocal about the need for OPEC to produce more oil,” ING analysts wrote in a note. “However, persuading OPEC to increase production will not be an easy task as Russia increasingly aligns itself with OPEC members through the OPEC+ alliance, and as the budget deficit for key members increases oil prices.”
In a speech at the World Economic Forum in Davos on Friday, Saudi Arabia’s Minister of Economy, Faisal Al Ibrahim, said that the position of Saudi Arabia and OPEC is the long-term stability of the oil market.
(Amber Warrick contributed to this article.)