Oil prices rise on trade talk optimism, OPEC cuts

Oil prices rise on trade talk optimism, OPEC cuts

During the session, the contract touched $49.95, the highest since December 17.

The World Bank's January 2019 World Economic Outlook is titled "Global Economic Prospects". Traders are also expecting that the decision of OPEC and some non-OPEC members including Russian Federation to reduce crude output by 1.2 million barrels per day from this month will significantly alter supply - demand imbalance in the market.

Crude prices have been buoyed by supply cuts from the Organization of the Petroleum Exporting Countries including top exporter Saudi Arabia, and allies including Russian Federation.

Upcoming trade talks between the U.S. and China are seen as an opportunity to tone down recent trade rhetoric between the world's two largest economies.

The world's largest crude oil seller exported around 7.3 mbpd of crude in December and 7.9 mbpd in November, according to the report.

US Commerce Secretary Wilbur Ross said late on Monday that Beijing and Washington could reach a trade deal that "we can live with" as dozens of officials from the world's two largest economies held talks in a bid to end their trade dispute that has roiled global markets since previous year.

By the average oil price the WB implies the average price of Brent, Dubai and WTI blends.

Friday's better-than-expected jobs report, with 312,000 jobs created in December, helped to underscore strength in the USA economy, assuaging some fears of an imminent recession in world's largest economy, along with market-supportive comments from the Federal Reserve.

The America-China trade talks are showing signs of progress.

Consultancy JBC Energy said it was likely that United States crude oil production was already "significantly above 12 million bpd" by early January.

Aside from the U.S.

China and the U.S. agreed to a ceasefire in their trade war at the G20 summit in Argentina at the end of November 2018.

Despite the partial government shutdown, entering its 18th day, the Energy Information Administration has said it has appropriations for the fiscal year 2019 and will release its reports as usual, including the weekly petroleum supply data due Wednesday. On Friday, crude oil futures ended up $0.87, or 1.9%, at $47.96 a barrel, extending gains to a fifth successive session.

Futures increased as much as 3 percent to nearly $50 a barrel in NY on Tuesday. The contract closed 0.5% higher at $57.33 on Monday. “Weather continues to call for more mild temperatures ahead, with the recent run of above average temperatures across much of the country already expected to once again trigger a much smaller than normal draw from the EIA's natural gas storage report on Thursday.”.

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