LONDON: Oil prices held steady on Monday following last week's heavy losses, as deepening US trade wars fanned fears of a global economic slowdown but top oil exporter Saudi Arabia sought to calm markets.
Saudi, the de-facto leader of OPEC, indicated that the group of oil producers together with Russia would continue managing global crude supplies to avoid a surplus.
"We will do what is needed to sustain market stability beyond June. To me, that means drawing down inventories from their currently elevated levels," Saudi Energy Minister Khalid al-Falih said.
Front-month Brent crude futures were at $62.02 at 0945 GMT, up 3 cents, or 0.05pc, above Friday's close. Prices had dropped by more than 3pc on Friday, with May recording the biggest monthly loss in six months.
US West Texas Intermediate (WTI) crude futures were at $53.74 per barrel, up 24 cents, or 0.45pc.
"Saudi Arabia's preference for continuing with, or even deepening, the OPEC+ output cut commitment has also provided a lift to prices," said Abhishek Kumar, head of analytics at Interfax Energy in London.
"Nevertheless, the escalating trade war of the United States with China, the European Union and Mexico will cap price gains in the run-up to the OPEC+ meeting."
Global markets have skidded in recent weeks due to concerns that the economy could stall amid rising trade tensions between the United States and China, the world's two largest economies and biggest energy consumers.
Fears over trade were further stoked when US President Donald Trump announced punitive tariffs against Mexico, a major oil supplier to the United States.
"Traders are increasingly pricing in a prolonged trade war hitting the global economy," said Jasper Lawler, head of research at futures brokerage London Capital Group.
In a typical market move during times of uncertainty, gold rose to its highest level in more than two months on Monday as investors pulled out of risky assets such as oil and parked money in perceived safe havens.
Brent crude oil prices have dropped almost 20% from their 2018 peak as global supplies tightened due to output curbs by the Organization of the Petroleum Exporting Countries and Russia, as well as a drop in Iranian exports due to US sanctions and Venezuelan production.
Saudi Arabia pumped 9.65 million barrels of oil per day (bpd), cutting deeper than its production target under a global pact to reduce oil supply, a Saudi oil industry source said on Monday.
The Saudi output target under the OPEC-led pact is 10.3 million bpd.
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