Brent and West Texas Intermediate crudes rose Thursday after China hinted at progress towards a trade deal with the U.S., raising hopes for an end to a dispute that’s weighed on economic growth and fuel demand in both countries.
China and the U.S. have agreed in the past two weeks to cancel tariffs in different phases, the Chinese commerce ministry said Thursday, without giving a timeline, Kallanish Energy reports.
The trade dispute has prompted analysts to lower forecasts for oil demand and raised concerns a supply glut could develop in 2020.
Brent crude rose 87 cents, or 1.4%, to $62.63 a barrel, after finishing down $1.22 Wednesday. West Texas Intermediate crude climbed $1.30, or 2.3%, to $57.65/Bbl.
Beijing’s comments boosted market sentiment, which had also been impacted by Wednesday’s Energy Information Administration crude inventories report showing said inventories rose last week by 7.93 million barrels, much more than analysts expected.
Brent has rallied 15% in 2019, supported by a deal between most Opec producers and 10 non-Opec producers led by Russia, collectively known as Opec+ which, since Jan. 1, has agreed to cut production by 1.2 million barrels per day, through March 2020.
The producers meet Dec. 5-6 in Vienna to review the policy.
Opec Secretary-General Mohammad Barkindo said this week he was more optimistic about the outlook for 2020 because of developments on trade disputes, appearing to downplay any need to cut output more deeply.
This post appeared first on Kallanish Energy News.