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Oil advances on rekindled US-Sino trade hopes

Oil advances on rekindled US-Sino trade hopes

Mubasher: Oil prices edged up on Monday amid positive headlines that revived hopes that the US and China could soon hammer out an initial deal to put their crippling trade conflict to an end, according to Reuters.

By 7:15 am GMT, US Nymex crude futures rose by 0.31% to $57.95 per barrel (pb), while global benchmark Brent futures climbed by 0.39% to $63.64 pb.

US national security adviser Robert O’Brien said over the weekend that Washington and Beijing could possibly still clinch an interim trade deal by the end of this year.

This followed a report that US President Donald Trump and Chinese President Xi Jinping voiced their willingness to ink a preliminary trade deal and end a long-drawn tariff war, despite the former said he had still to decide whether he would finalise a deal, while the latter stated that would not be afraid to respond when necessary.

“It is still all about trade talks [which] seems to be dominating markets action at the moment,” Sydney-based CMC Markets chief strategist Michael McCarthy was quoted by Reuters.

However, worries that Hong Kong protests could ruin the progress in the bilateral trade talks.

O’Brien, however, warned that Washington would not turn a blind eye to the events in Hong Kong, where demonstrators protested what is perceived as Beijing interfering with freedoms pledged, when the city state returned to the Chinese rule more than two decades ago.

On the supply front, a likely extension of the supply cuts by the Organization of the Petroleum Exporting Countries (OPEC) and their allies, including Russia helped support prices.

The producer group members meet on 5 and 6 December in Vienna, where they are set to extend output restraints three more months to mid-2020 and the meeting will be followed by the so-called OPEC+ alliance.