WTI prices climbed to about $56.30 during Thursday’s Asian session after U.S. crude stockpiles decreased. The U.S. Energy Information Administration reported a drop of 3.831 million barrels for the week ending January 2, while a rise of 1.1 million barrels was expected. This surprising decrease indicated stronger demand, helping to raise WTI prices. Additionally, the upcoming U.S. employment report for December looks important, with predictions of around 60,000 new jobs and the unemployment rate possibly falling to 4.5%.

Political Impacts On Oil Trade

President Donald Trump’s recent deal to import up to $2 billion of Venezuelan oil could limit WTI’s price gains. U.S. forces have recently removed Nicolas Maduro from power in Venezuela, affecting oil trade dynamics. WTI oil, known for its quality, experiences price changes due to various factors, including global economic growth and political events. Key factors like inventory levels and OPEC decisions heavily influence prices. Inventory data reveals shifts in supply and demand, while OPEC’s choices impact production levels. Prices are also affected by the U.S. Dollar’s value since oil is mainly traded in USD. The rise in WTI prices to nearly $56.30 reflects a significant decrease in U.S. crude stocks, signaling strong demand. Last year, the EIA reported a 3.831 million barrel drop for the first week of January 2025, far below the expected 1.1 million barrel increase. This unexpected inventory decline is why the market is strong now. However, potential new supply may hinder this upward momentum. A political shift in Venezuela in 2025 led to a deal to export oil to the U.S., which introduces uncertainty for the coming year. For context, Venezuelan production was just over 800,000 barrels per day in late 2025, far below its historical output, so any increase might push prices down.

Macroeconomic Influences On Oil Prices

We are also monitoring macroeconomic data and its effect on the dollar, which in turn impacts oil demand. The latest U.S. jobs report for December 2025 showed a stronger-than-expected gain of 216,000 jobs, with the unemployment rate steady at 3.7%. A strong labor market may keep the dollar robust, creating short-term challenges for crude prices. With strong immediate demand facing potential new supply and a strong dollar, we expect higher volatility. Traders in derivatives should consider strategies to profit from large price swings rather than betting on just one direction. Options strategies like long straddles or strangles could be beneficial in navigating this uncertainty in the upcoming weeks. Looking ahead, the actions of OPEC+ will be vital. The group’s recent choice in December 2025 to implement voluntary production cuts of 2.2 million barrels per day for the first quarter of 2026 is currently supporting the market. Traders should keep a close eye on how well these cuts are upheld and what OPEC signals at its next meeting regarding future production levels. Create your live VT Markets account and start trading now.

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