Crude oil futures were largely steady during mid-morning trade in Asia Monday as markets digested mixed news on ongoing trade talks between the US and China while awaiting fresh cues to provide price direction. At 10:10 am Singapore time (0210 GMT), ICE January Brent crude futures had inched up 6 cents/b (0.09%) from Friday’s settle to $62.15/b, while the front-month NYMEX January light sweet crude contract was 8 cents/b (0.14%) higher at $57.85/b.
“The crude oil market failed to find the same wave of positive sentiment [as last week] amid lackluster activity,” ANZ analysts said in a note Monday. Focus remains on developments in the US-China trade talks and comments from oil ministers ahead of OPEC’s next meeting in December, analysts said.
China’s President Xi Jinping Friday said the country wanted to conclude a phase one trade agreement with the US based on “mutual respect and equality,” telling an audience of international visitors that the world’s second largest economy would “when necessary, fight back” in a trade war that he said had been initiated by the US and unwanted by China.
However, the US Chamber of Commerce said Friday the phase one deal might not be agreed prior to December 15, when the next round of tariffs on Chinese goods are scheduled. “A positive start to the trading week is expected with the trade comments from President Donald Trump last week, though investors remain contemplating the US-China trade issue that may not make concrete headway by year end,” said IG market strategist Pan Jingyi.
US President Donald Trump Friday said that US and China were very close to reaching a partial trade deal but added was in no hurry to sign.
“Asian markets may attempt to trade on a more positive tone this morning amid hopes on the US-China phase one trade deal gaining momentum, ” OCBC Bank analysts said in a note Monday.
Baker Hughes data released Friday showed the number of active US oil rigs fell by three to 671 in the week ended November 22. “Cuts to US shale output appear to be more likely. Drilling activity continues to fall,” ANZ analysts said in a note.