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Valero, Chevron Tap Trans Mountain Pipeline for West Coast Crude

Momentum Grows For Oil, But Recession Fears Cap Gains

U.S. West Texas Intermediate crude oil futures settled about 2% higher on Thursday on positive U.S. economic data and optimism that global demand will strengthen as top oil importer China reopens its economy. The move pushed futures prices higher for the week and in a position to add to the current rally. Renewed buying by the major hedge funds is also a bullish sign.

Better-than-Expected US Economic Data Providing Support

Gross Domestic Product increased at a 2.9% annualized rate in the fourth quarter of 2022 as consumers boosted spending on goods, the Commerce Department said. But momentum rapidly slowed toward the year's end, as rising interest rates eroded demand.

Growth in personal consumption expenditures slowed to 2.1% on an annualized basis from 2.3% in the prior quarter and the GDP price index, another inflation measure, decelerated to 3.5%.

A separate report from the Labor Department on Thursday showed initial claims for state unemployment benefits dropped 6,000 to a seasonally adjusted 186,000 for the week ended Jan. 21. The number of people receiving benefits after an initial week of aid, a proxy for hiring, increased 20,000 to 1.675 million for the week ended Jan. 14.

Another report released by the Commerce Department on Thursday showed new orders for U.S. manufactured durable goods soared by much more than expected in the month of December.

The Commerce Department said durable goods orders spiked by 5.6 percent in December after…

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