Oil prices rally as investors hope for progress in US-China trade talks
Oil prices climbed $1 higher on Monday as investors pray for an end to the ongoing trade war between the world’s two largest economies.
Oil prices climbed $1 higher, driven by investors hoping for progress in US-China trade talks which are scheduled to recommence on Thursday.
Brent crude rose by $1.09 a barrel to $59.46 on Monday, representing a 1.8% increase, while the US West Texas Intermediate (WTI) rallied by $1.06 to $53.87, up 2%.
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US-China officials commence negotiations this week
Top officials from China and the US will meet on Thursday to commence the latest round of trade talks with the aim of breaking the deadlock between the world’s two largest economies.
‘The two sides will look to build on the deputy-level talks of the past weeks,’ White House spokeswoman Stephanie Grisham said in a statement.
‘Topics of discussion will include forced technology transfer, intellectual property rights, services, non-tariff barriers, agriculture, and enforcement.’
Supply fears continue
Oil prices have remained supported by supply fears from major exporters, with civil unrest in Iraq – the second-largest OPEC producer – and the recent attack on Saudi Aramco’s facilities expected to severely disrupt oil production.
3.43 million barrels per day (bpd) of oil from Iraq’s Basra terminals are likely to be disrupted if anti-government protests continue, Ayham Kamel, Eurasia Group’s practice head for Middle East and North Africa, said in a note.
‘Any oil production disruption would occur at a time when Saudi Arabia has lost a significant part of its energy system redundancies (spare capacity),’ he said.
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