WTI Crude Oil Strengthens on Rising Hopes for US-China Trade Deal in 2019
WTI crude oil prices are off to a promising start early on Monday, making gains on optimistic statements regarding the phase one trade deal between the US and China. At the time of writing, WTI crude oil is trading at around $57.89 per barrel.
The US-China trade war has been dominating the sentiment in oil markets, driving major price action in crude oil lately. Earlier this year, oil prices weakened as trade tensions escalated with fresh tariff threats issued by both nations on each other’s imports. When the trade war escalates, it impacts economic growth not just in the US and China but in other countries as well, which weakens the demand for oil.
WTI crude oil has turned bullish at the beginning of the week after US NSA Robert O’Brien expressed hopes for the interim trade deal to be signed before the end of 2019. Adding further weight to this hope was China’s latest move towards ensuring IP protection, which could help dispel some of the trade tensions with the US.
However, crude oil prices still remain under pressure as the Hong Kong issue remains in focus. Even though both the US and China have expressed hopes towards resolving their trade dispute, any interference by the US on the Hong Kong protests could upset the tense atmosphere and could potentially hurt the trade negotiations as well.
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