Oil Prices Begin 2025 on a Positive Note Amid Signs of Lower US Stockpiles

Brent nears $75, while WTI hovers around $72 as market eyes supply and demand dynamics

Oil prices edged higher in the opening session of the new year, with Brent crude climbing to nearly $75 per barrel and West Texas Intermediate trading around $72. This upward movement follows a report by the American Petroleum Institute indicating a 1.4 million barrel drop in US crude stockpiles last week, marking the sixth consecutive weekly decline if confirmed by government data.

Despite these gains, oil markets have been largely range-bound since mid-October, with Brent recording a slight annual decline and WTI finishing 2024 nearly flat. Analysts anticipate risks to Brent prices on the upside through the first quarter, with projections suggesting a potential rise to the $75–$80 range. However, concerns over rising supply and subdued demand could weigh on prices in the latter half of the year.

Geopolitical tensions in the Middle East and Ukraine, coupled with sanctions affecting Iranian and Russian exports, could provide short-term support to oil prices. Meanwhile, uncertainty surrounding China’s economic recovery and the growing adoption of new energy vehicles continue to challenge long-term demand growth.

News source: Energy Connects