Adedapo Adesanya
By Adedapo Adesanya
Oil rose on Thursday, October 17, as a result of weaker dollar and the announcement that the United Kingdom and the European Union reaching a deal on Brexit.
The international benchmark Brent crude oil went up by 52 cents or 0.88 percent to trade at $59.94 per barrel, while the United States’ West Texas Intermediate (WTI) crude oil was also up 69 cents or 1.29 percent to settle at $54.05 per barrel.
Also, industry data showed a larger build-up in US inventories than what was expected as it went by 9.3 million barrels to 434.9 million barrels in the week to October 11, the US Energy Information Administration said.
Analysts had estimated that the United States’ crude inventories rose by around 2.8 million barrels last week.
On the new Brexit deal which helped limit the fall in oil prices, the United Kingdom Prime Minister Boris Johnson said that Britain and the European Union had agreed a “mnew Brexit deal and urged lawmakers to approve it at the weekend.
On his part, European Commission President Jean-Claude Juncker also confirmed that Britain and the EU had agreed a deal.
According to reports, The UK and EU agreed to a “backstop” – a guarantee there would be no return to a hard border between Northern Ireland and the Republic of Ireland with checks, police, or soldiers – because of decades of violence in Northern Ireland in the past.
The backstop could have meant Northern Ireland being treated differently from the rest of the UK – or, as in the final draft, the entire UK staying “aligned” with the EU.
Northern Ireland’s Democratic Unionist Party (or DUP) was fiercely against either option – and the party remains a key source of votes needed to get a deal done.
Also, the hopes of a potential US-China trade deal also supported crude prices as China’s commerce ministry said on Thursday that China hoped to reach a phased agreement with the United States as early as possible, and make progress on canceling tariffs on each others’ goods.
