Hopes for a trade deal between the United States and China and expectations that OPEC would extend production cuts supported oil prices on Monday, helping them hold on to last week’s gains.
Brent crude futures LCOc1, which rose 1.3 per cent last week, were little changed, trading at above 63 dollars per barrel at 1100 GMT.
West Texas Intermediate (WTI) crude CLc1 was also flat at 57.7 dollars a barrel, having gained 0.8 per cent last week.
Oil rose on Friday as comments from a top U.S. official raised optimism for a U.S.-China trade deal, although worries about increasing crude supplies capped prices.
“In the short term, U.S.-China trade talks and (the) OPEC meeting in early December are the two biggest events oil traders are watching for,” Margaret Yang, an analyst at CMC Markets, said.
The 16-month trade war between the world’s two biggest economies has slowed global growth, prompting analysts to lower forecasts for oil demand growth and raising concerns that a supply glut could develop in 2020.
China and the United States had “constructive talks” on trade in a high-level call on Saturday, state media Xinhua reported on Sunday, but it gave few other details.
In a signal that policymakers are ready to act to prop up slowing growth, China’s central bank unexpectedly trimmed a closely-watched lending rate on Monday, the first such cut in more than four years.
The Organisation of the Petroleum Exporting Countries (OPEC) said last week it expected demand for its oil to fall in 2020, supporting a view that there is a case for the group and other producers like Russia – collectively known as ‘OPEC+’ – to maintain limits on production that were introduced to cope with a supply glut.
OPEC and its allies are expected to discuss output policy at a meeting on Dec. 5-6 in Vienna. Their existing production deal runs until March.
U.S. energy firms this week reduced the number of oil rigs operating for a fourth week in a row.
