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Oil futures traded flat to slightly higher Monday after ending last week at a three-month high, finding support after the U.S. and China reached a so-called phase one agreement on trade, de-escalating tensions between the world’s two largest economies.
West Texas Intermediate crude for January delivery CLF20, +0.05% was unchanged at $60.07 a barrel on the New York Mercantile Exchange, while February Brent crude BRNG20, +0.32% gained 19 cents, or 0.3%, to trade at $65.41 a barrel on ICE Europe. Both grades of crude ended Friday at their highest levels since Sept. 16.
“Buoyancy is being generated by optimism about the economy, rising stock markets world-wide in view of the ‘phase one deal’ in the trade dispute between China and the U.S., and a weak U.S. dollar,” said Eugen Weinberg, analyst at Commerzbank, in a Monday note.
U.S. and Chinese officials late last week announced a phase one trade pact that included a partial rollback of some tariffs and the scrapping of further U.S. duties on Chinese imports that were due to take effect on Sunday, while Beijing promised targeted agricultural purchases.
U.S. Trade Representative Robert Lighthizer on Sunday told CBS that the phase one China deal was “totally done.” He said the deal goes beyond agriculture to address intellectual property issues, has strong enforcement provisions and addresses financial services and currency issues. A number of contentious issues remain to be resolved in further “phase two” talks, which have yet to be scheduled. The deal is expected to be signed in January, he said.
In other energy trade, January gasoline RBF20, +0.02% fell 0.3% to $1.6589 a gallon, while January heating oil HOF20, +0.83% was up 0.6% at $1.9978 a gallon.
January natural-gas NGF20, +0.13% were flat at $2.296 per million British thermal units.
