SINGAPORE: Oil prices held steady on Friday, torn between hopes the United States and China could soon settle their trade disputes and new data raising fresh concerns over China's economic slowdown.
International Brent crude oil futures were at $60.87 per barrel at 0244, 3 cents aboe their last close.
U.S. West Texas Intermediate (WTI) futures were at $53.70 per barrel, down 9 cents, or 0.2 percent their last settlement.
Oil futures received support from a broader financial market rally, which saw Asian shares hit four-month highs on Friday on hopes the United States and China could strike a trade deal.
U.S. President Donald Trump said on Thursday he will meet with Chinese President Xi Jinping soon to try to seal a comprehensive trade deal as Trump and his top trade negotiator both cited substantial progress in two days of high-level talks.
Yet prices were weighed down by a survey on Friday that showed China's factory activity shrank by the most in almost three years in January amid slumping orders, reinforcing fears a slowdown in the world's second-largest economy is deepening.
Despite these concerns, traders said oil markets overall are being supported by supply cuts from the Organization of the Petroleum Exporting Countries (OPEC), which according to a Reuters poll pumped 30.98 million barrels per day (bpd) in January, down 890,000 bpd from December.
In Venezuela, meanwhile, U.S. sanctions imposed on state oil firm PDVSA this week are keeping tankers stuck at ports and are expected to accelerate the supply drop in February.
"The latest U.S. sanctions could directly halt around 500,000 barrels per day (bpd) of Venezuelan exports to the U.S.," Citi bank said.
Much Venezuelan crude oil is rated as heavy and requires the light petroleum naphtha, much of it supplied from the United States, for dilution before export to refineries.
"An additional 350,000 bpd of Venezuelan oil output is at risk due to the lack of U.S. dilutents, a result of the U.S. product exports ban with immediate effect," Citi said.
Comments
Comments are closed.