Mubasher: Oil prices rose on Monday as markets were cautiously hopeful of a recovery from last week’s losses on progress in negotiations between the US and China to end their trade conflict, even with worries that a global economic slowdown is weighing on future oil demand, according to Reuters.

By 9:33 am GMT, US Nymex crude futures climbed by 0.32% to $52.93 per barrel (pb), while global benchmark Brent futures rose by 0.27% to $58.53 pb.

Both contracts settled last week with a more than 5% drop on the back of disappointing factory data from the US and China, as the protracted row between the world’s two biggest economies weighed on global growth, raising the risk of recession.

Officials from the US and China are due to meet in Washington on 10 and 11 October.

On the supply side, Saudi Arabia resumed its production faster than expected, after an attack on its major oil installations pressured oil prices.

“The macro headwinds outweigh supply concerns for oil now, despite tensions in the Middle East and a reduced spare capacity pillow,” AxiCorp Asia Pacific market strategist Stephen Innes was quoted by Reuters.

On the other hand, deadly anti-government unrest in Iraq the second biggest producer Organization of the Petroleum Exporting Countries threatened the country’s output.

Iraq’s oil exports of 3.43 million barrels per day (bpd) from Basra terminals could be stalled if the instability persists for weeks, according to a note by Eurasia Group’s practice head for MENA Ayham Kamel.

Moreover, “while Saudi oil production is now close to 9.9 million bpd, it is not clear that the capacity is fully operational at 11.3 million bpd and the Abqaiq facility has lost a significant part of its redundancy,” Kamel was quoted by Reuters.

Global supply also is going under pressures from facility repair and maintenance.

China’s national firm CNOOC on Friday said that the Buzzard oilfield was closed for pipe repair work.

It is worth pointing out that the British North Sea oilfield is a major producer of the Forties crude stream, which is the largest of the five North Sea oil grades supporting Brent futures.

In Libya, the Faregh oilfield at Zueitina port will be close to go under a scheduled maintainence as from next Monday, the National Oil Corporation (NOC) said on Sunday.

These announcements came before OPEC’s Secretary General Mohammed Barkindo said it was too early to discuss further supply cuts, even with the declines of oil prices, according to Russian news agency TASS.