Oil prices rose on Monday, lifted by news that China and the United States had put a looming trade war between the world’s two biggest economies “on hold”.
U.S. West Texas Intermediate (WTI) crude futures were at $71.94 a barrel, up 57 cents, or 0.8 percent, from their last settlement.
Brent crude futures were at $78.87 per barrel at 0045 GMT, up 36 cents, or 0.5 percent, from their last close. Brent broke through $80 for the first time since November 2014 last week.
Put on Hold
The U.S. trade war with China is “on hold” after the world’s largest economies agreed to drop their tariff threats while they work on a wider trade agreement, U.S. Treasury Secretary Steven Mnuchin said on Sunday, giving global markets a lift in early trading on Monday.
“The U.S. and China agreeing to no trade war will be positive for oil prices given that the possibility of a full-out trade war would have dealt a significant blow to global growth,” said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.
However, crude prices were some way off the November 2014 highs reached last week, as many traders and analysts say there is enough supply to meet demand despite ongoing production cuts led by the Organization of the Petroleum Exporting Countries (OPEC), plunging output in crisis-struck Venezuela and looming U.S. sanctions against major oil producer Iran.
“Without a further escalation in geopolitical risk, oil might be due a pullback,” said Greg McKenna, chief market strategist at futures brokerage AxiTrader.
The U.S. oil rig count, an early indicator of future output, was at 844, according to energy services firm Baker Hughes. That was the same count as the week before, which marked the highest level since March 2015.