Oil prices were higher on Thursday, supported by an upbeat weekly report showing a decrease in U.S. crude supplies
Oil Prices Rise After Upbeat U.S. Data – Oil prices were higher on Thursday, supported by an upbeat weekly report showing a decrease in U.S. crude supplies. The report helped ease investor worry over an increase in U.S. production. The price of oil has been stuck between the rise in U.S. shale and a deal from the Organization of the Petroleum Exporting Countries’ and Russia to curb production and end a global supply glut. OPEC has been cutting crude output by 1.8 million barrels per day (bpd) to prop up oil prices. The pact began in January 2017 and is set to expire at the end of 2018 but de-facto leader Saudi Arabia is pushing for the cuts to extend into 2019. OPEC member Qatar’s energy minister Mohammed al-Sada said Thursday that he supports the idea of maintaining oil supply curbs. While prices have recovered, there has not been an increase in investment, he said. “There is a clear recovery in oil prices. But it has not been met with an increase in investments … Investment has been very low. My concern is that medium- to long-term demand is met comfortably,” Sada told Reuters. “Investors are still cautious and over-conservative”.
Gold Prices Slump as Trade Tensions Ease – Gold prices fell on Thursday as risk appetite recovered amid investor bets that recent tariff announcements by the U.S. and China are negotiating tactics and the countries will ultimately reach a compromise. Prices of the precious metal had rallied to a one-week high on Wednesday after China announced a fresh wave of tariffs on U.S. imports, in retaliation to a Trump administration plan to impose tariffs on Chinese products. Worries that protectionist trade policies might result in a full blown trade war boosted safe haven demand for gold, amid fears over the impact on the global economy and U.S. growth. But trade tensions eased after President Donald Trump’s economic adviser Larry Kudlow said late Wednesday that proposed tariffs on China may not actually take effect and added that there is not a trade war between the U.S. and China. Market sentiment was also helped by hopes that the U.S. could reach a deal with Canada and Mexico over the North American Free Trade Agreement. The dollar moved higher as trade concerns eased, with the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rising 0.31% to 107.09.
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