US benchmark West Texas Intermediate (WTI) crude oil prices were trading around $77.85 on Friday (17/1). WTI prices fell slightly as Houthi attacks in the Red Sea were expected to halt after a ceasefire deal in the Gaza war between Israel and the Hamas militant group was reached.

Maritime security officials said on Thursday that they expected the Houthi militia to announce an end to its attacks on ships in the Red Sea. "The Houthi developments and the ceasefire in Gaza are helping to keep the region calm, taking some of the safety premium off oil prices," said John Kilduff, a partner at Again Capital in New York.

The US Commerce Department reported on Thursday that US Retail Sales rose in December, indicating strong demand in the economy. In addition, the Federal Reserve's cautious approach to cutting interest rates this year is likely to support the greenback in the near term and weigh on USD-denominated commodity prices. The Federal Open Market Committee (FOMC) members will meet again on January 28-29, with prices unlikely to move.

On the other hand, analysts expect oil consumption to rise by 1.4 million barrels per day year-on-year in the coming weeks, driven by increased travel activity in India, where a major festival is underway, as well as travel for the Lunar New Year celebrations in China in late January.

Oil traders will be closely watching China's Gross Domestic Product (GDP) release for the fourth quarter (Q4) of 2024, along with Retail Sales and Industrial Production. Any sign of a recovery in the Chinese economy could support WTI prices as China is the world's second-largest oil consumer. (AL)

Source: FXstreet