Oil Posts Biggest Weekly Gain In Five Weeks as Supplies Tighten

Oil is still down from an April peak as the trade spat between Washington and Beijing dented demand.

28 Oct 2019, 04:04 AM IST

Oil Posts Biggest Weekly Gain In Five Weeks as Supplies Tighten

Petroleum gas drips from the nozzle of a fuel pump hose at a gas station, operated by Tatneft PJSC, in Kazan, Tatarstan, Russia. (Photographer: Andrey Rudakov/Bloomberg)

(Bloomberg) -- Oil posted the biggest weekly gain in more than a month as supplies tightened and the White House signaled progress on U.S.-China trade talks.

Futures in New York rose for a fourth day. U.S. crude stockpiles fell for the first time in six weeks, the EIA said Wednesday, while a critical North Sea oil pipeline was briefly shut Thursday. The U.S. and China “seem to be on the glide path” to a possible signing of phase one of a trade deal in Chile next month, a White House adviser told Fox News.

“We are a little optimistic that there will be a China-U.S. Trade deal,” Bart Melek, commodity strategist at Toronto Dominion Bank, said by phone.

Oil is down about 15% from an April peak as the trade spat between Washington and Beijing dents demand, though President Donald Trump has raised expectations that he and Chinese President Xi Jinping are making progress.

“We’re doing very well with China” and “they want to make a deal very badly,” the president told reporters outside of the White House Friday.

West Texas Intermediate for December delivery rose 43 cents to settle at $56.66 a barrel on the New York Mercantile Exchange for a weekly rise of 5.4%.

Brent for December settlement climbed 35 cents to close at $62.02 a barrel on the London-based ICE Futures Europe Exchange. Prices are 4.4% higher this week. The global benchmark crude traded at a $5.36 premium to WTI.

Other oil market news
Gasoline futures rose 0.6% to $1.6730 per gallon. Kazakhstan’s oil production is setting new daily records after maintenance works were completed at the country’s three big oil fields. U.S. oil rigs fell 17 to 696, the lowest since April 2017, according to data from Baker Hughes. Russian oil production was about 47,000 barrels a day above its OPEC+ target in the first three weeks of October, the narrowest gap since the Druzhba crude contamination incident earlier in the year. Iraq’s oil exports were cut by 150,000 barrels a day in October as the country committed to the OPEC output deal, Deputy Oil Minister Fayyad Al-Nima said in Baghdad.

Other oil market news

Gasoline futures rose 0.6% to $1.6730 per gallon.
Kazakhstan’s oil production is setting new daily records after maintenance works were completed at the country’s three big oil fields.
U.S. oil rigs fell 17 to 696, the lowest since April 2017, according to data from Baker Hughes.
Russian oil production was about 47,000 barrels a day above its OPEC+ target in the first three weeks of October, the narrowest gap since the Druzhba crude contamination incident earlier in the year.
Iraq’s oil exports were cut by 150,000 barrels a day in October as the country committed to the OPEC output deal, Deputy Oil Minister Fayyad Al-Nima said in Baghdad.

--With assistance from Robert Tuttle and Grant Smith.

To contact the reporters on this story: Robert Tuttle in Calgary at rtuttle@bloomberg.net;Catherine Ngai in New York at cngai16@bloomberg.net

To contact the editors responsible for this story: James Herron at jherron9@bloomberg.net, Catherine Traywick, Christine Buurma