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August 17 saw a revivification in oil prices, witnessing a 1% surge after a persistent downswing for three consecutive days. This rejuvenation in prices came in response to a dwindling of U.S. gasoline stocks, signaling robust travel demand. Simultaneously, initiatives by China's central bank to strengthen both its property sector and the broader economy played a crucial role. By midday, Brent crude was charted at $84.70 a barrel, representing a 1.5% jump, while U.S. West Texas Intermediate (WTI) crude climbed by 1.8% to settle at $80.86 a barrel.

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In the backdrop, concerns from the previous trading session still loom. Prices had plummeted by over 1.5%, mainly due to apprehensions surrounding China's wobbly economy and looming prospects of U.S. interest rate hikes. Dennis Kissler of BOK Financial weighed in on the trend, highlighting that, contrary to typical behavior post the U.S. Independence Day celebrations, "Travel demand has remained stubbornly strong." This assertion finds support in data from the U.S. Energy Information Administration. Reports from August 16 show gasoline stocks at their most depleted in over two months, while indicators of demand peaked, reaching levels unseen since December.

The proactive stance of China's central bank has drawn attention, with their commitment to ensuring adequate liquidity and their unwavering dedication to a "precise and forceful" policy to underpin the nation's economic recovery. Commenting on this, Naeem Aslam of Zaye Capital Markets remarked, "Oil traders appreciate China's evident determination to stave off economic sluggishness."

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Meanwhile, in the U.S., the discourse around interest rates intensifies. Fresh from the Federal Reserve's July meeting, there was no clear consensus among officials regarding halting the trajectory of rate hikes. Such hikes, while serving certain economic objectives, tend to escalate borrowing costs. This, in turn, can act as a dampener for economic growth and consequently, can mitigate oil demand.

In a piece of uplifting news for the oil sector, July witnessed China tapping into its crude oil reserves, marking the first such instance in almost three years. Additionally, data highlighted a considerable shrinkage in U.S. oil stocks, which fell by nearly 6 million barrels, a trend driven by vigorous exports and refining activities. Yet, as OANDA's Moya pointed out, the future trajectory of oil prices is likely to be influenced by several macroeconomic factors, suggesting a stabilization around the $80 mark.

According to Procurement Resource, US oil prices recently sprang on the back of uptrend in the travel demand and the overall increase in the oil market hold tending China to turn to its inventories to substantiate the expansive demand.