Oil prices rose more than 2 percent on Tuesday, supported by hopes that crude demand may rise more quickly if talks between US and Chinese officials resolve the trade dispute between the world’s two biggest economies, Trend reports citing Reuters.
US West Texas Intermediate (WTI) crude oil futures CLc1 settled up $1.26, or 2.6 percent, at $49.78 a barrel. During the session, the contract touched $49.95, the highest since Dec. 17.
Brent crude futures LCOc1 rose $1.39 a barrel, or 2.4 percent, to $58.72.
“The trade situation is definitely bullish; you have a good demand construction if we can wrap up this trade deal,” said Bob Yawger, director of futures at Mizuho in New York.
The talks are going well so far and will continue on Wednesday, US delegation member Steven Winberg said.
These are the first face-to-face meetings between officials from the two countries since US President Donald Trump and Chinese President Xi Jinping agreed in December to a 90-day truce in a trade war that has buffeted global financial markets.
On Monday, US Commerce Secretary Wilbur Ross and China’s foreign ministry expressed optimism on resolving the dispute.
Some analysts warned, however, that tensions could flare anew.
Oil traders also worried that a possible worldwide economic slowdown could dent fuel consumption. The hedge fund industry has cut significantly its bullish positions in crude futures.
S&P Global Ratings said it had lowered its average oil price forecasts for 2019 by $10 per barrel to $55 for Brent and $50 per barrel for WTI.
“Our lower oil price assumptions reflect slowing demand and rising supply globally,” said S&P Global Ratings analyst Danny Huang.
Follow us on Twitter @AzerNewsAz