Oil prices traded higher on Monday, raised by positive remarks in the Sino-US trade talks and reports of a new drone strike in an oil field in Saudi Arabia.
West Texas Intermediate crude futures traded from New York rose 24 cents, or 0.4%, to $ 55.05 a barrel as of 07:30 AM ET, while Brent crude futures outside the US oil price index traded 35 cents, or 0.6%, at $ 58.99.
Yemeni rebels reportedly stormed an oil facility in Saudi Arabia over the weekend, causing a fire at a gas plant and adding to the geopolitical risk premia.
Although reports suggested it would take at least a week to repair the damage, the Saudi state-owned Aramco government said oil production was not affected, discounting initial gains of more than 1% crude.
Crude took advantage of a broad-based attack on the risk asset after a weekend of largely optimistic talks by the U.S. administration on trade. White House economic adviser Larry Kudlow said recent talks between the two sides were “positive” and the teleconferences will continue for a week to 10 days.
He indicated that they could lead to “substantial renovation of negotiations” that could begin with a visit by Chinese negotiators to the US
President Donald Trump however reiterated that he was not ready to “make a deal yet”.
Both OPEC and the International Energy Agency have had to revise their forecasts of rising oil demand this year due to leaks from the US-China trade conflict.
Investing.com senior commodity analyst Barani Krishnan said the annual Federal Reserve forum in Jackson Hole, Wyoming, later this week should give the market more clarity on the picture after two weeks of volatility fueled by conflicting signals.
Ole Hansen, head of commodity strategy at Saxo Bank, noted via Twitter that fears of global demand were continuing to put pressure on Brent’s premium on US WTI standards. It flagged data from the Commodity and Futures Trading Commission on Friday that showed long-term net speculative interest for the WTI rising above its five-year average, though falling below the five-year average for Brent.
WTI has consistently traded at a discount to Brent since the start of the shale oil boom.
Also weighing prices, Baker Hughes’ data released on Friday showed that US energy firms increased the number of oil fraudsters operating for the first time in seven weeks, despite plans by most manufacturers to cut drilling costs. new this year
In other energy trades, gasoline futures rise 0.1% to $ 1,6590 a gallon by 7:33 AM ET (11:33 GMT), while heating oil rises 0.2% to $ 1,8172 a gallon. gallon.
Finally, futures for natural gas traded down 1.5% to $ 2,167 per million British thermal units./Investing.com