Oil futures: Crude steadies, China plans fresh stimulus measures

Quantum Commodity Intelligence - Crude oil futures were steady Thursday, with investors looking for details on Beijing's plans to boost China's stumbling economy via a number of monetary easing measures, which could include lower interest rates.

Front-month Feb25 ICE Brent futures were trading at $73.64/b (1745 GMT) versus the day's range of $72.42-74/b and Wednesday's settle of $73.52/b.

At the same time Jan25 NYMEX WTI was trading at $69.51/b, versus Wednesday's settle of $70.29/b.

Prices had found support this week on expectations that China will unveil new stimulus for 2025. Following the high-profile economic summit in Beijing, China's leaders pledged to ease monetary policy in a bid to boost the domestic economy. 

The Politburo said this would be achieved by lifting the fiscal deficit ratio and increasing the issuance of treasury bonds, although for now the announcement was light on detail.

Oil benchmarks also wobbled after the ECB delivered a downbeat assessment of the eurozone in, with President Lagarde flagging slowing growth momentum, while warning that looming trade restrictions with the US could add to further downside risks.

Sanctions

Crude benchmarks had strengthened this week after the US government flagged further sanctions against Russia, with current pricing levels and spare capacity seen as an opportunity to clamp down without causing too much volatility.

"A more comfortable oil market provides the opportunity to tighten sanctions on Russia. However, while they might want to target some Russian oil export volumes, they do not wish to cut off the bulk of these flows as this would push the market into a deep deficit, pushing prices significantly higher," said Warren Patterson, head of ING's commodity research.

The parting shot from the outgoing Biden administration dovetails with expectations that the new Trump presidency will hit Iran with additional oil sanctions.

Meanwhile, the Energy Agency said global oil demand growth was set to accelerate to 1.1 million bpd in 2025 from 840,000 bpd in 2024, lifting consumption to 103.9 million bpd.

But the Paris-based agency added supply is likely to "comfortably" meet rising demand next year.