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Oil down as investors weigh trade deal progress

Oil down as investors weigh trade deal progress

LONDON, Nov 8: Oil pared a weekly gain as investors weighed signs of progress in the prolonged U.S.-China trade war that’s undermined global crude demand, according to a report by Bloomberg. While futures in New York lost 1.1 per cent on Friday, oil is still up 0.6 per cent for the week. The U.S. and China have agreed to roll back tariffs on each other’s goods in phases as they work toward a deal, according to both sides. Renewed trade optimism offset swelling American crude inventories and indications OPEC and its allies won’t make deeper cuts to supply. Oil is still down almost 15 per cent since an April peak as the trade spat sapped crude consumption and global supplies expanded. The Organization of Petroleum Exporting Countries and its partners will likely keep output steady when they meet next month as markets are on track to re-balance, according to Goldman Sachs Group Inc. and Trafigura Group Ltd. An announcement on a completed phase one trade deal “would send oil prices significantly higher,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney, predicting West Texas Intermediate crude could climb as high as $65. “But as we’ve seen many times, trade-talk sentiment reverses very sharply and we are vulnerable to further falls in the near term.” WTI for December delivery declined 60 cents to $56.55 a barrel on the New York Mercantile Exchange as of 6:39 a.m. London time. The contract rose 80 cents to $57.15 on Thursday.

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