Oil settles up as US, China teams to meet following Trump, Xi trade call
Oil prices settled higher on Thursday, recovering from the previous day's drop, on news that the U.S. and China agreed to more trade talks following a phone call between U.S. President Donald Trump and Chinese leader Xi Jinping.
Brent crude futures settled up 48 cents, or 0.7%, at $65.34 a barrel. U.S. West Texas Intermediate crude settled up 52 cents, or 0.8%, at $63.37 a barrel.
"If we step back from the brink of a major trade war, it will increase demand expectations for oil both in the U.S. and in China," said Phil Flynn, senior analyst with Price Futures Group.
The official Xinhua news agency reported earlier that the talks were held at Trump's request.
Trump said on social media his call with Xi focused primarily on trade and led to "a very positive conclusion." He announced further lower-level U.S.-China discussions.
"We're in very good shape with China and the trade deal," he told reporters later.
Canadian Prime Minister Mark Carney and Trump are also in direct communication as part of Ottawa's bid to persuade Washington to lift tariffs, Industry Minister Melanie Joly said.
The news encouraged investors a day after oil fell 1% as data showed U.S. gasoline and distillate stockpiles grew more than expected, reflecting weaker demand in the world's largest economy.
Geopolitical events and wildfires in Canada that threaten to reduce oil production are providing further price support, despite a potentially oversupplied market in the second half of the year with expected OPEC+ production hikes, PVM analyst Tamas Varga said.
Source: Reuters
