Oil is growing by more than a percent, but the outlook is still mixed

Oil prices rose by around 1 percent on Wednesday, extending gains from the previous session on hopes that Washington and Beijing may soon resolve trade disputes that have cast a dark shadow over the global economy.

U.S. West Texas Intermediate (WTI) crude oil futures CLc1 were at $50.42 per barrel at 0752 GMT, up 64 cents, or 1.3 percent, from their last settlement. That marked the first time this year that WTI has topped $50 a barrel. International Brent crude futures LCOc1 were up 69 cents, or 1.2 percent, at $59.41 per barrel. Both crude price benchmarks had already gained more than 2 percent in the previous session.

State newspaper China Daily said on Wednesday that Beijing is keen to put an end to its trade dispute with the United States, but that it will not make any “unreasonable concessions” and that any agreement must involve compromise on both sides. If no deal is reached by March 2, Trump has said he will proceed with raising tariffs to 25 percent from 10 percent on $200 billion worth of Chinese imports at a time when China’s economy is slowing significantly. Citing the trade tensions, the World Bank expects global economic growth to slow to 2.9 percent in 2019 from 3 percent in 2018. The OPEC-led cuts are aimed at reining in an emerging supply overhang, in part because U.S. crude oil output C-OUT-T-EIA surged by around 2 million barrels per day (bpd) in 2018, to a record 11.7 million bpd.

Oil rises by over 1 percent on U.S., China trade talk optimism, Reuters, Jan 09