Oil Gains Seen in Sino-US Trade Talks Optimism

Oil prices rose on Monday as positive comments from the United States and China rekindled hopes in global markets that the world’s two largest economies could soon sign an interim deal to end their bitter trade war.

West Texas Intermediate crude rose 26 cents, or 0.45% to $58.03 a barrel, having ended last week little changed after tracking the trade talks through their ups and downs, CNBC reported.

Brent crude futures were at $63.73, up 34 cents or 0.54%, the benchmark having also finished little changed last week.

Monday’s higher opening prices came after US national security adviser Robert O’Brien said on Saturday that an initial trade agreement with China is still possible by the end of the year.

This came a day after US President Donald Trump and Chinese President Xi Jinping expressed a desire to sign an initial trade deal and defuse a 16-month tariff war that has lowered global growth. However, Trump said he had yet to decide whether he wanted to finalize a deal, while Xi said he would not be afraid to retaliate when necessary.

China’s foreign ministry said on Monday it hopes the United States will work with Beijing on a basis of equality and mutual respect on the ongoing bilateral trade negotiations.

The Organization of the Petroleum Exporting Countries meets on December 5 at its headquarters in Vienna, followed by talks with a group of other oil producers, led by Russia, known as OPEC+. Prices could be pushed higher if OPEC+ agrees to extend its supply cut by three more months to mid-2020.

source: Financial Tribune