Oil prices continues to extend gain on Thursday, buoyed by hopes that potential progress in the latest Sino-U.S. tariff talks would improve the global economic outlook.
U.S. West Texas Intermediate (WTI) crude futures were at $53.76 per barrel up 10 cents, or 0.2 per cent, from their last settlement. They closed up 1.5 per cent on Wednesday, having touched their highest since February 5 at $54.60 a barrel.
International Brent crude oil futures had yet to trade. They closed the previous session up 1.9 per cent, after marking their strongest since November 21 at $63.98 a barrel.
Optimism that a trade deal could be reached between the United States and China was boosted when U.S. President Donald Trump said talks were going “very well”.
“The 90-day truce (on trade) agreed in December will run out on March 1, but given the progress of the talks there could be an extension, which is why there are rising optimism that the two leaders will meet later that month,” said Alfonso Esparza, senior market analyst, OANDA.
But climbing U.S. oil stockpiles weighed on prices. U.S. crude oil inventories rose last week to the highest since November 2017 as refiners cut runs to the lowest since October 2017, the Energy Information Administration said on Wednesday.
Crude inventories built for a fourth week in a row, rising 3.6 million barrels to 450.8 million barrels in the week to Feb. 8. Analysts polled by Reuters forecast an increase of 2.7 million barrels.
The global oil market will struggle this year to absorb fast-growing crude supply from outside the Organization of the Petroleum Exporting Countries, even with the group’s production cuts and U.S. sanctions on Venezuela and Iran, the International Energy Agency said in a report on Wednesday.