Friday, July 1, 2022

Oil rises to $57 on China-U.S. trade talks, OPEC cuts


LONDON: Oil rose to around $57 a barrel on Friday after China said it would hold trade talks with the United States and a survey showed China’s services sector expanded in December, while signs of lower crude supply also lent support.

The Organization of the Petroleum Exporting Countries (OPEC) cut crude output in December, a Reuters survey showed, and the American Petroleum Institute (API) reported a 4.5 million-barrel drop in crude inventories.

Brent crude LCOc1, the global benchmark, was up $1.25 to $57.20 a barrel at 1113 GMT. U.S. crude oil CLc1 was up 90 cents at $47.99.

“Recent Chinese data is not confirming the doom-and-gloom trend,” said Olivier Jakob, oil analyst at Petromatrix. “And you’ve got OPEC cutting.”

China’s services sector extended its solid expansion in December, a private survey showed on Friday, bucking a trend of downbeat economic data.

Both oil benchmarks are on track for solid gains in the first week of 2019 trading despite rising concerns that the China-U.S. trade war will lead to a global economic slowdown.

But in comments that helped oil to rally, China’s commerce ministry said it would hold vice-ministerial trade talks with U.S. counterparts in Beijing on Jan. 7-8.

The two nations have been locked in a trade war for much of the past year, disrupting the flow of hundreds of billions of dollars worth of goods and raising concern of slowing growth.


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