Oil prices edge up as investors await news on US-China talks

18.11.2019 - Petr Mazaylo
Oil prices edge up as investors await news on US-China talks

Oil prices inched higher on Monday, following steady gains from previous week as investors await further news on the trade talks between US and China. Concerns over increasing oil supplies, possibly developing into a supply glut, were shrugged.

Brent crude futures was unchanged from previous session, at $63.30 a barrel at 0512 GMT. The contract increased 1.3% last week.

West Texas Intermediate (WTI) crude CLcl also remain unchanged at $57.72 a barrel, after gaining 0.8% the previous week.

Margaret Yang, market analyst at CMC Markets said that the “crude oil market is flat on Monday morning, as price consolidates after Friday’s big rally.”

On Friday, oil futures gained almost 2% as the market once again showed optimism following a top U.S. trade official expressed that the US and China were having agreeable talks for a trade deal. However, worries of increasing supplies of crude oil cut prices.

China and the U.S. have been back and forth in raising tariffs on a 16-month ongoing trade war. The dispute has slowed global economic growth, prompting analysts to lower forecasts for oil demand in 2020, adding that a supply glut was possible.

The world’s two largest economies have been reported to have high-level trade talks over phone, however no further details about its content were revealed.

“In the short term, US-China trade talks and OPEC meeting in early December are the two biggest events oil traders are watching for,” Yang said.

The Organization of the Petroleum Exporting Countries (OPEC) said that it was expecting a fall in demand for 2020, after market data showed that OPEC and other producers like Russia—known as ‘OPEC+’—to limit their production due to excess in supply.

OPEC and its allies are set to meet in Vienna in Dec. 5-6 to discuss output policy. Their current production deal ends in March.

The International Energy Agency (IEA) released a report that non-OPEC supply growth are set to rise at 2.3 million barrels per day next year, compared to 2019’s 1.8 million bpd, with supplies coming from the US, Norway, Brazil, and Guyana.

Data also showed that weekly US crude stockpiles increased by 2.2 million barrels, exceeding analyst forecasts of 1.649 million-barrel rise.

Risk disclaimer "PROMETHEUS LTD – Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Republic of the Marshall Islands MH96960 is a financial services institution outside the European Union Area, which is subject to the supervision of the IFMRRC Certificate 0395 AA V0155 Trading in Forex/ CFDs and Other Derivatives is highly speculative and carries a high level of risk. It is possible to lose all your capital. 70% of trading deals can be unprofitable. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent advice if necessary. Speculate only with funds that you can afford to lose. This Website may contain information in particular regarding financial services and products that could be regarded b a E.U. supervisory authority as an offer of financial services targeted in Europe. ESMA intervention measures do not apply to customers of PROMETHEUS LTD and it is your responsibility to choose a company which is most suitable for your trading needs. By clicking continue you confirm that you have read, understood and agree to the risk disclosures, terms of service, cash policies, privacy policies and this notice and that you are visiting this website on your own initiative, without any encouragement whatsoever from umarkets.net or PROMETHEUS LTD." Cookies notification: We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we assume that you are happy with it. Read more. Continue

Help with deposit?