SINGAPORE: Oil prices were stable on Tuesday, supported by hopes that talks in Beijing between US and Chinese officials might defuse trade disputes between the world’s biggest economies, while Opec-led supply cuts also tightened markets.
International Brent crude futures were at $57.42 per barrel at 0742 GMT, up 9 cents, or 0.2 per cent from their last close.
US West Texas Intermediate (WTI) crude oil futures were at $48.56 per barrel, up 4 cents, or 0.1 per cent.
US Commerce Secretary Wilbur Ross said on Monday that Beijing and Washington could reach a trade deal that “we can live with” as dozens of officials from China and the United States held talks in a bid to end a trade spat that has roiled global markets since last year.
Despite optimism around the talks in Beijing, some analysts warned that the relationship between Washington and Beijing remained on shaky grounds, and that tensions could flare up again soon.
“We remain concerned about the world’s most important bilateral relationship,” political risk consultancy Eurasia Group said in its 2019 outlook.
“The US political establishment believes engagement with Beijing is no longer working, and it’s embracing an openly confrontational approach…(and) rising nationalist sentiment makes it unlikely that Beijing will ignore US provocations,” Eurasia Group said.
There is also concern that a worldwide economic slowdown will dent fuel consumption.
As a result, the hedge fund industry has cut back significantly its bullish positions in crude futures.
S&P Global Ratings said it had lowered its average oil price forecasts for 2019 by $10 per barrel to $55 and $50 per barrel, respectively. — Reuters
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