Futures Movers: Oil edges higher as U.S.-China trade talks get under way

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Oil futures edged higher in choppy price action Thursday as traders attempted to make sense of conflicting news reports around U.S.-China trade talks and parsed OPEC’s monthly assessment of global supply and demand.

West Texas Intermediate crude for November delivery CLX19, +0.99%  rose 23 cents, or 0.4%, to $52.82 a barrel on the New York Mercantile Exchange, while the global benchmark, December Brent crude BRNZ19, +0.87%  gained 10 cents, or 0.2%, to trade at $58.42 a barrel.

“Reports are so confused and misleading at present that it is not possible to predict the outcome of the talks,” wrote analysts at Commerzbank. “If they break down, prices can be expected to fall further because concerns about demand would then increase significantly again. If any partial agreement were reached, a relief rally would be on the cards.”

Bloomberg News reported Wednesday night that the White House could implement a previously agreed upon currency deal with China ahead of schedule, and suspend tariff hikes due to take effect next week. The New York Times reported that President Donald Trump greenlighted issuing licenses to some U.S. companies to conduct business with Chinese telecom giant Huawei Technologies.

Earlier, the South China Morning Post had reported that talks earlier this week laying the groundwork for high-level talks due to begin Thursday had made little progress and that China’s main trade delegation would cut short its visit from two days to one.

Read: U.S.-China talks could lead to currency deal or collapse quickly, conflicting reports say

Meanwhile, the Organization of the Petroleum Exporting Countries, in its monthly report, trimmed its forecast for 2019 world oil-demand growth but left its outlook for 2020 unchanged. At the same time, it cut its outlook for non-OPEC supply growth in 2019 and 2020.

Meanwhile, continued protests in Ecuador kept oil fields shut, forcing state-owned oil company Petroecuador to declare force majeure on its crude exports, according to news reports.

Ecuador exported around 315,000 barrels a day of crude oil in September 2019, and an average of 392,000 barrels a day for the year-to-date, according to analysts at ING, with nearly half of it going to the U.S. West Coast. Lack of oil supplies from Ecuador could create some shortages at the West Coast in the short term, they said.

In other energy trading activity, November gasoline RBX19, +0.66%  rose 0.5%, to $1.5954 a gallon, while November heating oil HOX19, +0.65%  gained 0.5%, to $1.9284 a gallon.

November natural-gas futures NGX19, +0.81%  rose 0.6% to $2.248 per million British thermal units.

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