U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading higher on Friday and for the week for a number of reasons, mostly affecting the supply side. The markets are being supported primarily by deeper-than-expected OPEC-led production cuts and the impact of U.S.-led sanctions on Venezuelan oil exports. Despite these moves, on a macro level, the global oil market remains well-supplied. Additionally, gains are being limited by weakening global demand.
Production Cuts Supportive
In the meantime, the political rift between Venezuela and the United States continues with the U.S. sanctions against the South American nation giving prices a slight boost.
Trade Deal Optimism
Traders are saying that positive chatter about the on-going high-level U.S-China trade negotiations in Beijing are helping to support prices because an end of the trade dispute should drive up crude oil demand for the world’s second largest economy.
Rising Chinese Imports Supportive
On Thursday, a trade balance report showed China’s crude oil imports in January rose 4.8 percent from a year earlier to an average of 10.03 million barrels per day (bpd). This marked the third straight month that imports have exceeded the 10 million…