(Investing) – LONDON -Oil prices extended gains on Tuesday, buoyed by U.S.-China trade talks and a dip in Saudi Arabian crude supply to China.
futures rose 23 cents, or 0.3%, to $67.27 a barrel by 1331 GMT, hovering near their highest since April 28.
U.S. West Texas Intermediate crude was up 17 cents, or about 0.3%, at $65.46, near highs reached on April 4.
U.S.-China trade talks were set to continue for a second day in London as top officials aimed to ease tensions that have expanded from tariffs to rare earth minerals, risking global supply chain disruptions and slower growth.
“There’s a sense of optimism around these trade talks; the market is waiting to see what this will produce, and that is supporting prices,” said Harry Tchilinguirian, group head of research at Onyx Capital.
Prices have recovered as demand concerns have faded with the trade talks between Washington and Beijing and a favourable U.S. jobs report while there are risks to North American supply from wildfires in Canada, Goldman Sachs analysts said.
U.S. President Donald Trump said on Monday that the talks with China were going well and he was “only getting good reports” from his team in London.
A trade deal between the two nations could support the global economic outlook and boost demand for oil and other commodities.
On the supply side, allocations to Chinese refiners showed that Saudi Arabian state oil company Saudi Aramco (TADAWUL:) will ship about 47 million barrels of oil to China in July, 1 million barrels less than June’s allotted volume, Reuters reported.
