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Oil surges nearly 3 percent as China calms trade war jitters

Reuters  |  NEW YORK 

By Ayenat Mersie

NEW YORK (Reuters) - Oil prices rose nearly 3 percent on Tuesday as investors grew more confident that a brewing trade dispute between the and may be resolved without harming the global

Brent crude futures were up $2, or 2.9 percent, at $70.65 a barrel by 12:53 (1653 GMT). Intermediate crude futures also gained 2.9 percent, or $1.85, to $65.27 a barrel.

on Tuesday promised to open China's further and lower import tariffs, striking a conciliatory tone on the trade tensions between his country and the

Equities markets gained on the indication that a trade war is increasingly unlikely.

Both benchmarks have risen roughly 5 percent in the past two trading days. Brent is only 0.6 percent shy of its 2018 peak of $71.05 hit in late January. WTI is about 2 percent below its 2018 peak of $66.66.

"It's not so much 'risk on/risk off', as it is 'trade war on/trade war off' and, at the moment, we're 'trade-war off,'" London Capital Group's Jasper Lawler said.

Concerns over a possible trade war between the two largest economies contributed to a more than four percent decline in the prices of both

tensions also supported prices on Tuesday, said Phillip Streible, at in

"Oil markets are getting a bounce on increasing speculation about Trump and Syria," Streible said.

U.S. promised a swift response to a in Such a response is likely to increase the push for the to pull out of the nuclear deal, Streible said, given Iran's support of the

Departures from the accord would result in renewed sanctions against Iran, which would hurt its

The will publish storage data later on Tuesday. Analysts anticipate a small build in crude stocks and a reduction in products inventories.

The said on Tuesday it expected domestic to rise by 750,000 barrels per day (bpd) to 11.44 million bpd next year, more than previously expected.

Meanwhile, said it would keep exports below 7 million bpd and restore its inventories to normal levels.

(Additional reporting by in LONDON and Henning Gloystein in SINGAPORE; Editing by and Will Dunham)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, April 10 2018. 22:52 IST