17 Jan 2025

• WTI price loses traction to near $77.85 in Friday’s early Asian session. 
• Maritime security officials expect a halt to Houthi shipping attacks. 
• The expectation of rising oil demand during the Lunar New Year might support the WTI price.
• West Texas Intermediate (WTI), the benchmark for US crude oil, is currently trading at approximately $77.85 on Friday. The price of WTI has experienced a slight decline due to anticipated cessation of Houthi shipping attacks in the Red Sea, following a ceasefire agreement in the ongoing conflict in Gaza between Israel and Hamas.
  
  Maritime security officials indicated on Thursday that they expect the Houthi militia to declare an end to its assaults on vessels in the Red Sea. John Kilduff, a partner at Again Capital in New York, remarked, "The developments involving the Houthis and the ceasefire in Gaza contribute to a more stable regional environment, thereby reducing some of the security premium associated with oil prices."
  
  Additionally, the US Commerce Department reported on Thursday that retail sales in the United States rose in December, suggesting robust economic demand. Furthermore, the Federal Reserve's cautious stance regarding interest rate cuts this year may bolster the US dollar in the short term, potentially exerting downward pressure on the price of this USD-denominated commodity. The Federal Open Market Committee (FOMC) is scheduled to convene again on January 28-29, with market expectations indicating a negligible likelihood of any policy changes.
  
  Conversely, analysts project an increase in oil consumption of 1.4 million barrels per day year-on-year in the coming weeks, fueled by heightened travel activity in India due to a major festival, as well as travel for Lunar New Year celebrations in China at the end of January.
• Oil traders will pay careful attention to the upcoming release of China's Gross Domestic Product (GDP) for the fourth quarter (Q4) of 2024, in addition to the figures for Retail Sales and Industrial Production. Indicators suggesting a recovery in the Chinese economy may provide support for WTI prices, given that China ranks as the second-largest oil consumer globally.