Oil prices drop from two-month high as US-China trade deal remains uncertain
22.11.2019 - Petr Mazaylo
Oil prices drop from two-month high as US-China trade deal remains uncertain

Oil prices dropped from a two-month high on Friday due to uncertainty on the demands of oil futures. The market remains anxious of the prospect of a US-China trade deal and of the global economy.

These uncertainties are enough for major producers to likely extend production cuts. In the previous session of discussing the possibility of a tight crude supply, prices were raised.

Brent crude futures LCOcl had slipped 0.5%, or 30 cents, priced at $63.67 a barrel. West Texas Intermediate crude CLcl slid 0.6%, or 34 cents, at $58.24 a barrel.

“The key factor for the demand outlook for oil is the (US-China) trade negotiation currently going on,” Michael McCarthy, chief market strategist at CMC Markets and Stockbroking in Sydney said.

“With oil near the top of recent trading ranges it’s no surprise to see a bit of selling pressure during the session today.”

Oil prices had their peak since September when the Organization of the Petroleum Exporting Countries and its allies including Russia (OPEC+) were reported to likely extend production cuts until mid-2020.

Oil was also kept steady by news from Chinese commerce ministry saying that China will strive to come up with an initial agreement of the deal with US. This will effectively bring an end to the 16-month trade war. However, the trade deal’s first phase could be finalized by next year.

In other parts of the world, traders keep an eye on oil production amid protests in Iran and Iraq.

Risk disclaimer "Market Solutions Ltd – Suite 305 Griffith Corporate Centre P.O. Box 1510 Beachmont, Kingstown, St Vincent and the Grenadines is a financial services institution outside the European Union Area, which is subject to the supervision of the IFMRRC Certificate 0395 AA V0128 Trading in Forex/ CFDs and Other Derivatives is highly speculative and carries a high level of risk. It is possible to lose all your capital. 70% of trading deals can be unprofitable. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent advice if necessary. Speculate only with funds that you can afford to lose. This Website may contain information in particular regarding financial services and products that could be regarded b a E.U. supervisory authority as an offer of financial services targeted in Europe. ESMA intervention measures do not apply to customers of Market solutions Ltd and it is your responsibility to choose a company which is most suitable for your trading needs. By clicking continue you confirm that you have read, understood and agree to the risk disclosures, terms of service, cash policies, privacy policies and this notice and that you are visiting this website on your own initiative, without any encouragement whatsoever from Umarkets.com or Market Solutions limited." Cookies notification: “We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we assume that you are happy with it. Continue