Oil prices have surged in the thin holiday trade as investors anticipate colder weather across the US and Europe, boosting diesel demand.
Brent crude futures rose 22 cents to settle at $74.39 a barrel, while US West Texas Intermediate crude gained 39 cents to reach $70.99 a barrel. US ultra-low sulfur diesel futures reached their highest level since November, increasing by 2.5% to $2.30 a gallon.
The increase in diesel prices is driven by concerns over colder weather and the need for space heating, which is expected to rise to 499 heating degree days over the next two weeks in the US. This surge in demand is also bolstered by rising export demand for natural gas.
US crude stockpiles are also expected to have fallen by about 3 million barrels last week, providing further support to oil prices. Investors will be keeping an eye on China’s PMI factory surveys and US ISM survey due out this week, which will provide insights into the economic health of top oil-consuming nations.
Source: https://www.reuters.com/business/energy/oil-inches-lower-thin-trade-investors-eye-china-us-data-2024-12-30