Quick overview

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Oil prices rose on Friday as news of potential additional oil supply from Venezuela was overshadowed by optimism about trade talks, which boosted the outlook for the global economy and oil demand.

Brent crude futures hit a one-week high at $69 a barrel, gaining 29 cents, or 0.42%. US West Texas Intermediate (WTI) crude futures increased by 29 cents, or 0.44%, to $66.3. Expectations of new trade agreements between the US and other nations supported oil and stock markets, especially ahead of August 1, when the US plans to impose more tariffs on products from various countries.

Two European diplomats mentioned that the EU is working toward an agreement that would include a 15 percent US tariff on EU imports following the announcement of a trade deal between the US and Japan on Wednesday, with possible exemptions.

The US is preparing to allow its partners in Venezuela’s state-run PDVSA, starting with the US oil giant Chevron, to engage in limited business in the sanctioned country.

This move could ease the tightness in the heavier crude market, which would benefit US refiners.

Venezuelan oil exports might likely increase by over 200,000 barrels per day. WTI has fallen by 1.4 percent, while Brent has risen by 0.4 percent.

Both contracts also gained about 1% yesterday amid news of Russian gasoline export cuts, boosted by the US market.

US crude inventories decreased by 3.2 million barrels to 419 million barrels last week, according to data from the US Energy Information Administration released Wednesday, significantly more than the 1.6 million barrel draw predicted by analysts in a Reuters poll.