Oil Gives up Early Gains to Close Lower Tuesday
By Adedapo Adesanya
Oil prices shed earlier gains on Tuesday as President Donald Trump in a speech offered few new details about the United States trade talks with China.
As at 9pm Nigerian Time on Tuesday, the Brent crude futures were trading down 13 cents or 0.21 percent at $62.05 per barrel after rising to as high as $62.50 earlier in the day.
On the other hand, US West Texas Intermediate (WTI) crude was also down 6 cents or 0.11 percent at $56.80 per barrel, having hit up to $57.09 per barrel on Tuesday morning.
President Trump, speaking to the Economic Club of New York on Tuesday, gave out mixed signals about the US-China trade talks and excluded much details about any progress in negotiations. The oil markets, which is keen for any update on the talks, quickly appreciated as a result of this.
However, on Saturday, the US President had said that talks with China were moving along “very nicely” but the United States would only make a deal if it was favourable. He also noted there had been incorrect reporting about US willingness to lift tariffs.
Oil prices had also received boosts folllowing US data showing that crude inventories at Cushing, the delivery point for WTI, fell about 1.2 million barrels in the week to November 8 according to market intelligence firm, Genscape. This means that Cushing inventories had now grown for five weeks in a row through November 1.
CNBC reports show that crude stockpiles in the US were forecast to have risen last week for a third week in a row, according to a poll ahead of government data due on Thursday showed. It was revealed that Weekly energy data has been delayed a day due to the Veterans Holiday on Monday.
On the supply side, the actions of the Organisation of the Petroleum Exporting Countries (OPEC) and its allied producers pushed Brent as it recorded a 16 percent rise so far in 2019.
The cartel had cut production output by 1.2 million barrels per day to its members in a deal that would run till March 2020, but recently, there had been talks that they won’t push for deeper oil supply cuts when they meet next month in Vienna on December 5 and 6 to review the policy.
It was said that the member states and allies may stick to their current output targets and encourage producers to comply more fully with those targets.