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Brent and WTI crude futures rise over 1%

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Price fluctuations expected due to holiday market

inactivity

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China's fiscal stimulus plan supports oil prices

By Paul Carsten

LONDON, Dec 24 (Reuters) - Oil prices rose on Tuesday,

reversing the prior session's losses, buoyed by a slightly

positive market outlook for the short term, despite thin trade

ahead of the Christmas holiday.

Brent crude futures were up 74 cents, or 1%, at

$73.37 a barrel, and U.S. West Texas Intermediate crude futures

also rose 74 cents, or 1.1%, to $69.98 a barrel by 1400

GMT.

FGE analysts said they anticipated the benchmark prices

would fluctuate around current levels in the short term "as

activity in the paper markets decreases during the holiday

season and market participants stay on the sidelines until they

get a clearer view of 2024 and 2025 global oil balances."

Supply and demand changes in December have been supportive

of their current less-bearish view so far, the analysts said in

a note.

"Given how short the paper market is on positioning, any

supply disruption could lead to upward spikes in structure,"

they added.

Some other analysts also pointed to signs of greater oil

demand over the next few months.

"The year is ending with the consensus from major agencies

over long 2025 liquids balances starting to break down," said

Neil Crosby, Sparta Commodities' assistant vice-president of oil

analytics, in a note.

"The EIA's short-term energy outlook (STEO) recently shifted

their 2025 liquids to a draw, despite continuing to bring back

some OPEC+ barrels next year."

A plan by China, the world's biggest oil importer, to issue 3

trillion yuan ($411 billion) worth of special treasury bonds

next year, as Beijing ramps up fiscal stimulus to revive a

faltering economy, was also supportive for prices.

That is likely to provide near-term support for WTI crude at

$67 a barrel, said OANDA senior market analyst Kelvin Wong.

Markets will also be watching the U.S. economy, the world's

largest oil consumer, which released a mixed bag of data

overnight.

While consumer confidence weakened in December, new orders

for key U.S.-manufactured capital goods surged in November amid

strong demand for machinery and new home sales rebounded,

suggesting the U.S. economy was on a solid footing as the year

closes out.