Major oil producers are pointing to signs of better economic growth in the second half of the year

International News via Reuters:

Oil prices rose on Wednesday, boosted by expectations of firm summer demand in the world’s two largest consumers, the United States and China, though gains were capped by analysts’ caution about the wider economy.

Prices have seesawed in a tight range as signs of steady demand from an increase in travel during the Northern Hemisphere summer have competed with concerns that U.S. tariffs on trading partners will slow economic growth and fuel consumption.

Brent crude futures rose 36 cents, or 0.5%, to $69.07 a barrel by 0646 GMT. U.S. West Texas Intermediate crude futures were up 47 cents, or 0.9%, to $66.99.

That reversed two days of declines as the market downplayed the potential for supply disruptions after U.S. President Donald Trump threatened tariffs on purchases of Russian oil.

Major oil producers are pointing to signs of better economic growth in the second half of the year while data from China showed consistent growth.

“Strong seasonal demand is currently providing upward momentum to oil prices, as summer travel and industrial activity peak,” LSEG analysts said in a note.

“Increased gasoline consumption, especially in the U.S. during the Fourth of July holiday period, has signalled robust fuel demand, helping offset bearish pressures from rising inventories and tariff concerns.”

China data showed growth slowed in the second quarter, but less than feared, in part because of frontloading to beat U.S. tariffs. That eased some concerns about the economy of the world’s largest importer of crude.

The data also showed that China’s crude oil throughput in June jumped 8.5% from a year earlier, indicating stronger fuel demand.

However, some analysts saw the price rebound as temporary.

Much of the steadying of crude markets after two volatile sessions resulted from a mild technical correction rather than any significant shift in underlying fundamentals, said Phillip Nova’s senior market analyst Priyanka Sachdeva.

“Investors should monitor inflation and interest rate expectations in the United States as Trump’s continued push for broader tariffs could be inflationary and could dampen fuel demand in the medium term,” she said.

OPEC’s narrative remained more optimistic, Sachdeva said, pointing to the grouping’s monthly report on Tuesday that forecast that the global economy would do better in the year’s second half, boosting the oil demand outlook.

Brazil, China and India are exceeding expectations while the U.S. and EU are recovering from last year, it added.

“The technicals may offer short-term relief, but fundamentally, the market lacks momentum,” Sachdeva said.

“Until clarity emerges on global growth, policy direction, and real demand recovery, especially from Asia, the crude complex looks set to drift sideways.”

Reporting by Colleen Howe; Editing by Christian Schmollinger and Rachna Uppal

That would mean zero growth this year and 1.2% growth next year in Germany, Europe’s biggest economy

International News via Reuters:

U.S. tariffs of 30% on imports from the EU, planned by President Donald Trump, could cost the German economy about a quarter of a percentage point in growth this year and next compared with current forecasts, the IMK institute said on Wednesday.

Trump has said he will impose 30% tariffs on imports from the EU from August 1 if there is no progress on trade talks.

That would mean zero growth this year and 1.2% growth next year in Germany, Europe’s biggest economy, according to the IMK institute.

This compares with its previous forecast for a recovery from the fourth quarter and average growth of 0.2% for 2025, rising to 1.5% next year, driven by a planned boost in public investment and defence spending.

“A rapid implementation of the planned public investment offensive could significantly reduce the economic risks in Germany,” said the IMK.

“Growth losses in the U.S. would be far greater than in Germany,” it said, adding the U.S. was until last year the most important export market for Germany with an almost 10% share.

Reporting by Madeline Chambers, Editing by Miranda Murray

Flights at Keflavik airport in the capital of Reykjavik were not affected

International News via Reuters:

A volcano erupted on Wednesday in southwest Iceland, authorities said, with live media images showing it belched smoke and dramatic flows of glowing hot yellow and orange lava, the latest in a series of outbreaks near the capital in recent years.

Often referred to as a land of ice and fire, the North Atlantic island nation with its many glaciers and volcanoes has now experienced a dozen eruptions since geological systems on its Reykjanes peninsula reactivated in 2021.

Magma forced through the earth’s crust opened a massive fissure of length between 700 m and 1,000 m (0.4 miles and 0.6 miles), Iceland’s meteorological office said, with the first signs of the eruption giving scant warning.

“(It does) not threaten any infrastructure at this time,” the office said in a statement. “Based on GPS measurements and deformation signals, it is likely that this was a relatively small eruption.”

Flights at Keflavik airport in the capital of Reykjavik were not affected, its web page showed.

Public broadcaster RUV said people had been evacuated from the Blue Lagoon, a luxury geothermal spa resort, and the nearby town of Grindavik, citing police.

Grindavik, home to nearly 4,000 before an evacuation order in 2023, has stayed mostly deserted since, for fear of the periodic threat from lava flows and related earthquakes.

The Reykjanes eruptions have not yet posed a threat to Reykjavik, nor ejected large volumes of ash into the stratosphere, so air traffic has not been disrupted.

Experts have said the eruptions in the area could recur for decades, or even centuries.

The fissure eruptions, as the outbreaks are known, are characterised by lava flows emerging from long cracks, rather than from a central crater.

Reporting by Isabelle Yr Carlsson, Anna Ringstrom and Louise Breusch Rasmussen; Editing by Stine Jacobsen and Clarence Fernandez