Oil prices remained stable on Thursday, buoyed by hopes of progress in upcoming trade negotiations between the world’s two largest economies—the United States and China.
At 08:03 GMT, Brent crude futures rose by 43 cents, or 0.7%, to $61.55 a barrel. Meanwhile, U.S. West Texas Intermediate (WTI) crude futures increased by 49 cents, or 0.8%, to $58.56 a barrel.
SEB analyst Ole Hvalbye noted that crude markets have largely stabilized above $61 a barrel, supported by optimism surrounding the current tariff environment and the potential breakthroughs in U.S.-China trade talks.
U.S. Treasury Secretary Scott Besant is scheduled to meet with China’s top economic official in Switzerland on May 10. The talks aim to address the ongoing trade war, which has disrupted the global economy and slowed oil demand growth.
Despite the trade optimism, analysts warn that pressure remains on oil prices. The Organization of the Petroleum Exporting Countries and its allies (OPEC+) are expected to increase production, which could weigh down prices in the coming months.
Citigroup analysts have revised their three-month forecast for Brent crude from $60 to $55 a barrel, although they maintain a full-year average prediction of $60. They added that a potential U.S.-Iran nuclear deal could increase global oil supply, pushing Brent prices as low as $50 per barrel. In contrast, the absence of a deal could see prices climb above $70.
On the monetary policy front, the U.S. Federal Reserve kept interest rates steady overnight but emphasized growing risks related to inflation and unemployment. According to analysts at ING, the Fed’s stance suggests that rates will remain unchanged until the impact of tariffs becomes clearer. This has strengthened the U.S. dollar, adding further resistance to commodity markets like oil.
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