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Economy

Oil prices rise 1% in thin pre-holiday trade

Date: Dec 25, 2024

Oil prices rose more than 1% on Tuesday, reversing the prior session's losses on a brightening short-term outlook tied to the prospect of slightly tightening supplies as trade thinned ahead of the Christmas and Hanukkah holidays.

Brent crude futures settled at $73.58, rising 1.3%.

United States West Texas Intermediate crude futures settled at $70.10, rising 1.2%.

FGE analysts said they expect the benchmark prices will fluctuate around current levels in the near term "as activity in the paper markets decreases during the holiday season and market participants stay on the sidelines until they get a clearer view of 2024 and 2025 global oil balances."

Supply and demand changes in December have been supportive of their current less-bearish view so far, the FGE analysts said in a note.

"Given how short the paper market is on positioning, any supply disruption could lead to upward spikes in structure," they added.

Some analysts also pointed to signs of greater oil demand over the next few months.

"The year is ending with the consensus from major agencies over long 2025 liquids balances starting to break down," Neil Crosby, Sparta Commodities' Assistant Vice President of Oil Analytics, said in a note.

--Reuters--