By Florence Tan and Emily Chow
SINGAPORE (Reuters) – Oil prices fell on Monday in thin trading due to holidays ahead of the end of the year, with traders awaiting more Chinese and US economic data later this week to assess growth in the world’s two largest oil consuming countries.
Futures fell eight cents to $74.09 a barrel by 0700 GMT, while the most active March contract was at $73.73 a barrel, down six cents.
US West Texas Intermediate crude fell five cents to $70.55 a barrel.
The two benchmarks rose about 1.4% last week, supported by a larger-than-expected withdrawal from stocks in the week ending December 20, as refiners intensify their activity and the holiday season supports demand for fuel. (Environmental Impact Assessment/Environmental Assessment)
Oil prices also received support from optimism about Chinese economic growth next year, which may increase demand from the largest crude oil importer.
To revive growth, Chinese authorities have agreed to issue a record 3 trillion yuan ($411 billion) worth of special treasury bonds in 2025, Reuters reported last week.
“Global oil consumption reached an all-time high in 2024 despite China performing below expectations, and oil inventories head into next year at relatively low levels,” said Ryan Fitzmaurice, chief commodities strategist at Marks.
“Going forward, Chinese economic data is expected to improve as the latest stimulus measures take effect in 2025. Also, lower interest rates in the US and elsewhere should be supportive of oil consumption.”
China has also issued at least 152.49 million metric tons of crude oil import quotas to independent refiners in a second batch for 2025 so far, trade sources said on Monday.
Separately, the World Bank raised its forecasts for China's economic growth in 2024 and 2025, but warned that weak household and business confidence, coupled with headwinds in the real estate sector, will remain a drag next year.
Investors are awaiting the results of the China factory PMI survey, scheduled to be released on Tuesday, and the US ISM survey for December, which will be released on Friday.
In Europe, hopes for a new agreement to transport Russian gas through Ukraine diminished after Russian President Vladimir Putin said on Thursday that there was no time left this year to sign a new agreement.
Analysts said that the loss of Russian gas through pipelines would push Europe to import more liquefied natural gas.
