Oil Movements at the end of the week
Oil prices witnessed some rises on Friday, to exceed the 60-dollar-a-barrel barrier, supported by positive expectations about the easing of global trade tensions.
The rise comes as the United States and China prepare to hold bilateral talks in Switzerland this weekend, the first since the two countries imposed punitive tariffs on each other's exports last month, almost paralyzing trade between the world's two largest economies.
US-China talks to contain the crisis
Treasury Secretary Scott Besant will meet with Chinese Vice Premier He Lifeng this weekend in preliminary talks to reduce the 145% US tariff on Chinese goods and the 125% Chinese tariff on US imports. This move is a gesture to restore confidence between the two countries after months of trade escalation that has rattled global markets.
US-UK trade agreement boosts economic prospects
The United States and the United Kingdom also announced on Thursday that they had reached a framework agreement for a new trade deal, which included keeping U.S. tariffs on British imports at 10%, while reducing tariffs on steel, aluminum and automotive products.
Britain also agreed to increase its purchases of beef and US ethanol, along with simplifying customs procedures for US imports, which enhances the chances of economic cooperation between the two allies.
Challenges of oil market balance
Despite the prevailing optimism, fears of an increase in oil supply continue to limit price gains, especially with the OPEC alliance preparing to pump an additional amount of oil estimated at 411 thousand barrels per day starting next June.
In this regard, the US Energy Information Administration indicated in its recent report that global oil inventories increased during the first four months of this year by an average of 300 thousand barrels per day, with expectations of an increase to 700 thousand barrels per day by the fourth quarter of the year.
