WATCH: Oil at new three-month high above $60 a Barrel
INTERNATIONAL - Oil rose to a fresh three-month high above $60 (R866) a barrel on optimism the partial US-China trade pact will bolster demand, while analysts estimated a pull-back in US crude stockpiles.
Futures gained 0.5percent in New York after rising 2.5percent over the previous three sessions.
A limited trade agreement, to be signed and released early next month, will see some tariffs reduced and prevent an escalation in the conflict between the world’s two largest economies.
US stockpiles are projected to have declined by 1.75million barrels last week, a survey showed. While leaving most of the tariffs built up over the trade war in place, the partial deal has relieved investors worried about further escalation and driven gains across the commodity complex. It follows deeper-than-expected output cuts agreed by Opec+ earlier in the month, which Citigroup said will help keep a floor under prices and which allayed some of the concern that next year will see a renewed oversupply.
“The conditions for a rising oil price appear favourable at present,” said Eugen Weinberg, the head of commodities research at Commerzbank in Frankfurt. “Economic optimism, coupled with a weaker US dollar and growing investor demand, have allowed Brent and West Texas Intermediate (WTI) to climb.”
WTI for January delivery rose 30cents to $60.51 a barrel on the New York Mercantile Exchange as of 8.35am local time. It advanced 0.2percent on Monday and is up about 10percent so far in December. Brent for February settlement climbed 28c to $65.62 a barrel on the ICE Futures Europe Exchange.