Oil Posts Weekly Advance on Trade Talks, OPEC Commitment
(Bloomberg) -- Oil in New York posted a second straight weekly advance as investors focus on talks between the U.S. and China on trade and as OPEC shows commitment to curbing production.
Futures added 0.5 percent in New York on Friday to the highest in more than three months. Trade talks in Washington between a Chinese delegation led by Vice Premier Liu He and U.S. officials on Friday were extended after showing signs of progress. Speaking through an interpreter, Liu said a deal with the U.S. is very likely to happen.
In regards to a potential U.S.-China trade agreement, “there is certainly the expectation that it might occur in the not-too-distant future,” said Bart Melek, head of global commodity strategy at TD Securities in Toronto. “Saudi Arabia has expressed that they are willing to cut supply to make sure the market is balanced.”
Oil has climbed this year as OPEC and its allies implement production cuts to help balance global markets. Saudi Arabia has cut deeper than it agreed to and has said it expects oil markets to balance by April.
West Texas Intermediate for April delivery added 30 cents to settle at $57.26 a barrel on the New York Mercantile Exchange. Futures climbed 3 percent this week. The U.S. benchmark also closed above its 100-day moving average after breaching the key level this week.
Brent for April settlement rose 5 cents to end the session at $67.12 a barrel on the London-based ICE Futures Europe exchange. The global benchmark crude was at a $9.86 premium
over WTI.
The U.S. and China reached an agreement on currency policy, Treasury Secretary Steven Mnuchin said. This week's round of talks were supposed to end Friday, but Liu extended his stay by two days.
“It looks like some of the risks an concerns around global growth seem to be abating a bit with some of the rhetoric coming out of the Trump administration and China regarding some conclusion or positive movement in the trade negotiations,” said Nick Holmes, an analyst at Tortoise in Leawood, Kansas, which manages $16 billion in energy-related assets.
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--With assistance from Sharon Cho and Grant Smith.
To contact the reporter on this story: Jessica Summers in New York at jsummers24@bloomberg.net
To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Mike Jeffers
©2019 Bloomberg L.P.
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