Tokyo: Oil climbed near the highest level in more than two months after OPEC and its allies signaled less urgency to boost output and stopped short of promising extra volumes of crude despite US pressure to temper prices. Futures in New York rose as much as 1.2 percent to trade near the highest level since July. The Organization of Petroleum Exporting Countries and its allied producers gave a tepid response to President Donald Trump’s demand that it take rapid action to reduce prices, saying it would boost output only if customers requested it. Signs of slowing growth in U.S. crude production also supported prices.
Oil near 2-month high as Opec snubs Trump’s demand for lower oil prices
Oil has rallied about 10 percent from the lows of mid-August as investors increasingly question whether OPEC and allies will boost output, with higher prices prompting Trump to renew his criticism of the producers’ quest for higher prices. Still, a full-blown trade war between the U.S. and China could imperil global economic growth that underpins crude demand as the two countries are hours away from a new round of tariffs on each other’s goods.
Oil investors are “trading the weekend news very favorably,” said Stephen Innes, Singapore-based head of Asia Pacific trading with Oanda Corp. “Saudi Arabia and Russia ruled out any expeditious supply increases at the Algeria meeting while decidedly ignoring U.S. President Trump’s call to increase supplies and ease price pressures.”
West Texas Intermediate for November delivery rose as much as 88 cents to $71.66 a barrel on the New York Mercantile Exchange and traded at $71.52 at 10:59 a.m. in Tokyo. The contract climbed 46 cents to $70.78 on Friday. Total volume traded was slightly above the 100-day average.
Brent for November rose 93 cents to $79.73 on the ICE Futures Europe exchange. The contract advanced 10 cents to $78.80 on Friday. The global benchmark traded at an $8.22 premium to WTI for the same month.