By Nicole Jao

NEW YORK (Reuters) – Oil fell on Thursday in light holiday trade as hopes for more fiscal stimulus in China, the world’s biggest oil importer, were offset by a stronger dollar.

Futures fell 19 cents, or 0.26%, to $73.39 a barrel at 12:45 pm EST (1745 GMT). US West Texas Intermediate crude was at $69.89, down 0.3%, or 21 cents, from Tuesday’s pre-Christmas settlement.

Chinese authorities have agreed to issue 3 trillion yuan ($411 billion) worth of special treasury bonds next year, Reuters reported on Tuesday, citing two sources, as Beijing ramps up fiscal stimulus to revive a faltering economy.

“Injecting a stimulus into a country’s economy creates more demand, and increased demand pushes prices higher,” said Tim Snyder, chief economist at Matador Economics.

The World Bank on Thursday raised its forecast for China’s economic growth in 2024 and 2025, but warned that declining household and business confidence, along with headwinds in the property sector, will continue to weigh and this next year.

The US dollar continues to move higher after hitting a milestone. A stronger dollar makes oil more expensive for holders of other currencies.

The latest weekly report on US inventories, from industry group the American Petroleum Institute, showed that crude stocks fell last week by 3.2 million barrels, market sources said on Tuesday.

Traders will wait to see if the official inventory report from the Energy Information Administration confirms the decline. The EIA data is due at 1 pm EST (1800 GMT) on Friday, later than normal due to the Christmas holiday.

Analysts in a Reuters poll expected crude oil inventories to fall by about 1.9 million barrels in the week to December 20, while gasoline and distillate inventories were seen falling by 1.1 million barrels and 0.3 million. barrel each.

Elsewhere, southbound traffic in Turkey’s Bosphorus Strait was scheduled to resume Thursday after it was halted earlier in the day after a tanker suffered engine failure, shipping agent Tribeca said.

($1 = 7.2975 renminbi)