By Adedapo Adesanya
Prices of crude oil closed mixed on Thursday as the global market for the commodity reacted differently to the signing into law a bill backing protesters in Hong Kong by President Donald Trump of the United States.
This act by the United States’ President fulled tensions with China, which is opposed to the protests that have lingered for months. The development came when hopes were high that both countries would sign the first phase of a trade deal.
This development, according to analysts, could deter both the United States and China who are set to hold conversation over a potential trade agreement that has affected oil demand globally.
Earlier in the day, the International benchmark, was trading down at $63.05 per barrel, while the US West Texas Intermediate (WTI ) crude was trading at $58 per barrel.
However, by 8pm Nigerian Time (GMT +1), the Brent crude futures were trading up at $63.27, rising by 26 Cents or 0.41 percent per barrel, while the WTI crude rose to 58.24 per barrel, gaining 13 cents equivalent to 0.22 percent.
Business Post reports that the Bonny Light crude produced by Nigeria remained at $64.04 percent yesterday, with the Qua Iboe still at $65.87 per barrel and the Brass River trading at $64.92 per barrel.
The United States and China were close to finally agreeing on the first phase of a trade deal as President Donald Trump said on Tuesday but with this latest development, China has warned that it would take firm countermeasures in response to the US legislation .
The global market which has been swayed by the US-China trade deal will face this as investors expressed concerns that the move might delay further a preliminary agreement between the United States and China to put an end to their trade war.
Early in the week, top negotiators from the both countries had spoken by telephone and agreed to keep working on remaining issues that bound them.
Following this, market analysts say that investors on suspecting that the trade agreement may face real danger, may begin a sharp sell-off in December.
Prices also dropped on the report by the Energy Information Administration (EIA) that stockpiles in the United States went up by 1.6 million barrels last week as production rose to a record 12.9 million barrels per day (bpd) which made refinery run slower.
Still on the supply side to aid the market, the Organization of the Petroleum Exporting Countries (OPEC) and Russia are looking to extend existing production cuts by another three months to June 2020 when they meet in December.
The cartel and its allies agreed to cut production output by 1.2 million barrels per day in a deal that would run till March 2020 but recently there was talks that the producers including Russia would extend this till June next year.
Meanwhile the latest news reported fhg Russian oil companies have proposed not to change their output quotas as part of the global deal until the end of March, putting pressure on OPEC+ to avoid any major policy change when they meet in December 5 in Vienna, Austria.
Dipo Olowookere