Oil edges up but US-China trade tensions curb gains

Oil edges up but US-China trade tensions curb gains

Oil edges up but US-China trade tensions curb gains

In addition, possible military action by the US and Saudi Arabia in Syria creates a high risk for safe production and exports of crude oil from the region and the kingdom, which could keep upward pressure on crude prices, experts warned.

Oil prices on Wednesday eased away from 2014 highs reached the previous session as escalating Middle East tensions were offset by increasing inventories and production in the United States.

Light, sweet crude for May delivery rose $1.29, or 2%, to $64.71 a barrel on the New York Mercantile Exchange, trading at a one-week high.

Brent crude oil briefly rose above $70 per barrel, but at the time of writing the price was at $69.83 a barrel, up 1.72 per cent.

Yet prices remain within recent ranges as oil markets still face an abundance of supply that puts pressure on producers to keep their prices competitive in order not to lose market share.

Traders said weekly USA fuel inventory data would provide further market guidance.

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The American Petroleum Institute will publish its storage data later on Tuesday.

Thanks to strong demand and relatively subdued supply, recent inventory data has mostly crude oil prices.

Beyond the trade dispute, oil markets are also concerned about the potential of renewed US sanctions against some significant oil producers. U.S. President Donald Trump promised a "major response" within 24 to 48 hours to an alleged chemical attack in Syria, which he said could be the work of the Syrian government, Iran, Russia or all three.

OPEC and other producers, including Russian Federation, agreed to cut output by about 1.8 million barrels per day (bpd) in November last year to slash global inventories to the five year-average.

However, soaring United States crude production, which has jumped by a quarter since mid-2016, threatens to undermine Opec's efforts.

The Saudis want oil prices near $80, in part to support the valuation of state-owned energy giant Aramco ahead of its initial public offering, Bloomberg News reported Tuesday (https://www.bloomberg.com/news/articles/2018-04-10/saudi-arabia-is-said-to-signal-ambition-for-80-oil-price?utm_medium=social&utm_campaign=socialflow-organic&utm_content=markets&cmpid%3D=socialflow-twitter-markets&utm_source=twitter), citing people who have spoken to delegates from the Organization of the Petroleum Exporting Countries and oil market participants.

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