Oil rises beyond $62 on trade talk hopes
Investors await Trump comments
Oil prices have risen above $62 a barrel, in part thanks to lower inventories at a key US oil hub, but mostly due to hopes that US president Donald Trump will indicate that trade talks with China are progressing.
Brent crude oil futures, the global benchmark, gained 0.76 per cent by mid-afternoon trading standing at $62.65 a barrel. West Texas Intermediate (WTI) crude oil futures are up by a greater margin, standing at $57.37 a barrel, a gain of 0.90 per cent, at time of writing.
Mr Trump is expected to make further positive comments on the negotiations to secure a trade agreement with China. Such an agreement will be limited but will importantly require the lifting of some tariffs imposed by both sides. Although President Trump pushed back on ‘incorrect reporting’ about America’s willingness to lift tariffs on Saturday, he admitted that the talks were progressing “very nicely”.
Although speculation and hearsay as to the progress of the talks have caused markets to rise and fall in recent weeks, investors will pay closer attention than normal to president Trump’s upcoming comments. It is also hoped that the Mr Trump will delay his decision to impose tariffs on European car and auto part imports.
The oil price also gained thanks to inventory data from Cushing, the delivery point for WTI. Crude inventories at Cushing fell for the first time in five weeks by around 1.2 million barrels in the week to November 8.