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Crude oil pushes toward strong back-to-back gains

11 April 2018
Crude oil pushes toward strong back-to-back gains

US West Texas Intermediate (WTI) crude futures for the May contract edged higher by 1.2 percent to $64.22 per barrel, while global benchmark Brent futures for June delivery climbed by 1.2 percent to $69.53 per barrel. Brent crude futures were at $67.42 per barrel, up 31 cents, or 0.5 percent.

Iran, meanwhile, struck a defiant tone on Monday, saying Western allies may have regrets should U.S. President Donald Trump break the United Nations -backed nuclear agreement when sanctions go under review in May.

But future USA involvement in the Middle East could interrupt crude supply chains and make it hard for producers to ship overseas, sparking a bid for oil on Tuesday.

The American Petroleum Institute will publish storage data later on Tuesday while official data from the U.S. Energy Information Administration is due on Wednesday. Adding to the tensions, Saudi Crown Prince Mohammed bin Salman said Tuesday that the country could be a part of an global response to the Syrian violence, Reuters reported.

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

Equities markets gained on the indication that a trade war is increasingly unlikely.

Shares of major energy stocks surged alongside crude.

President Xi Jinping promised on Tuesday to open China's economy further, lower import tariffs on cars and better enforce worldwide laws governing intellectual property. Total volume traded Tuesday was about 72 percent above the 100-day average.

It was unclear however, how Xi's promises will be able to resolve trade tensions between the two countries.

Brent crude's three year plus high came as geopolitical concerns in the Middle East - coupled with easing US-China trade tension, a weaker dollar and a small decline in forecasts for US oil production - saw the oil bulls emerge after being battered on Friday.

"Oil markets are getting a bounce on increasing speculation about Trump and Syria", Streible said. The minister said he would seek an extension to the OPEC-Russia deal, which expires in December.

West Africa's crude oil loadings for Asia are set to fall to a five-month low in April, dragged down by a backlog of cargoes outside China and strong Brent prices that hindered new bookings, a Reuters survey of shipping fixtures and traders showed on Friday. While Riyadh initially targeted the IPO for the second half of 2018, the Saudis are now forecasting the launch for 2019.