West Texas Intermediate (WTI), the US crude Oil benchmark, trades slightly higher around the $57.10 level during early Asian hours on Monday. Crude prices edge up as expectations of stronger demand from China improve sentiment, while traders remain cautious ahead of the American Petroleum Institute (API) crude Oil stockpiles report due on Tuesday.
Chinese fiscal stance supports oil demand expectations
According to a Bloomberg report published on Sunday, Chinese authorities have signaled a more proactive fiscal policy stance for 2026, pointing to continued government support aimed at sustaining economic growth amid a challenging global environment.
In a statement, China’s Ministry of Finance said Beijing plans to expand targeted investment in priority areas such as advanced manufacturing, technological innovation, and human capital development, following a year-end meeting to outline next year’s fiscal priorities.
Given that China is the world’s largest crude Oil importer, expectations of sustained policy support and stronger growth prospects are providing a mild tailwind to WTI prices.
Geopolitical uncertainty adds to price support
Geopolitical developments are also influencing market sentiment. US-led talks aimed at ending the war in Ukraine have yet to deliver a decisive breakthrough, which could lend near-term support to Oil prices.
US President Donald Trump said he had made “a lot of progress” in discussions with Ukrainian President Volodymyr Zelenskiy regarding a potential peace agreement, but acknowledged that key issues, particularly territorial disputes, remain unresolved and may take several weeks to address.
OPEC+ supply outlook caps upside potential
Despite the supportive factors, gains in WTI may remain capped amid concerns over a potential global supply glut.
The Organization of the Petroleum Exporting Countries and its allies (OPEC+) recently agreed to a modest production increase of 137,000 barrels per day for December, reinforcing expectations that rising supply could offset demand-side optimism and limit further upside in crude prices.
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