Oil steadies as U.S.-China trade war balances inventory drop

by Shadia Nasralla (Reuters) – Oil prices steadied on Thursday as an escalating trade battle between the United States and China counteracted upward pressure from a surprise decline in U.S. crude inventories. Heightened tensions between the world’s two biggest economies have clouded the outlook for global growth, which influences oil demand expectations. Global equity markets were hit. Brent crude oil futures were at $70.39 a barrel by 1030 GMT, up 2 cents from their previous settlement but still heading for their second consecutive weekly loss. Earlier in the session they fell as low as $69.57 a barrel. U.S. West Texas Intermediate (WTI) crude futures were at $62.00 per barrel, down 12 cents, making good on some earlier losses. WTI futures ended Wednesday 1.2 percent higher, while Brent climbed 0.7 percent. “Oil has been following equities’ moves, but the fundamentals remain strong for oil,” said Bjarne Schieldrop, chief commodity analyst at Swedish bank SEB. “Supply-side issues are bigger that those due to demand growth worries.” U.S. President Donald Trump said on Wednesday that China “broke the deal” in trade talks with Washington and would face stiff tariffs if no agreement is reached. Higher tariffs are set to take effect on Friday,… continue reading

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