NEW YORK – Oil prices edged higher on Friday, after falling more than 1% following comments from U.S. President Donald Trump that he has not agreed to roll back tariffs on China.
Brent crude futures rose 22 cents to settle at $62.51 a barrel. West Texas Intermediate (WTI) crude rose 9 cents to settle at $57.24 a barrel.
Brent posted a weekly rise of 1.3%, while WTI gained 1.9%.
Prices pared losses in midday trade, after Brent reached a session low of $60.66 a barrel and WTI sank to $55.76 a barrel.
“Given the volatility around the U.S.-China trade saga, it’s hard to be short over the weekend,” said John Kilduff, a partner at Again Capital LLC. “The turn of a phrase could restore the very hopes that were dashed just last night over a deal being struck.”
The 16-month trade war between the world’s two biggest economies has slowed economic growth around the world and prompted analysts to lower forecasts for oil demand, raising concerns that a supply glut could develop in 2020.
Oil prices fell earlier on Friday after Trump told reporters he has not agreed to roll back tariffs on China but that Beijing would like him to do so.
The comments come after officials from both countries on Thursday said China and the United States have agreed to roll back tariffs on each others’ goods in a “phase one” trade deal if it is completed.
However, the plan faces stiff internal opposition in the U.S. administration, Reuters reported on Thursday, and U.S. officials have signaled opposing views on the status of talks.
Oil prices have also been under pressure since OPEC Secretary-General Mohammad Barkindo said this week that he was more optimistic about the outlook for 2020, appearing to downplay any need to cut output more deeply.
A deal between the Organization of the Petroleum Exporting Countries and its allies, such as Russia, will limit supplies until March next year. The producers meet Dec. 5-6 in Vienna to review that policy.
“Even if a partial (U.S.-China) agreement is reached, the impetus for demand will not be enough to avoid an oversupply next year, meaning that OPEC will still need to make bigger production cuts,” Commerzbank said in a note.
While customs data showed that China’s crude oil imports in October rose 11.5% from a year earlier to a record high, bearish signals elsewhere tempered the news.
U.S. crude oil stockpiles rose sharply last week as refineries cut output and exports dropped, the Energy Information Administration said on Wednesday.
U.S. energy firms this week reduced the number of oil rigs operating for a third week in a row. Drillers cut seven rigs in the week to Nov. 8, bringing the total count down to 684, the lowest since April 2017, General Electric Co’s Baker Hughes energy services firm said.
Money managers boosted their net long U.S. crude futures and options positions in the week to Nov. 5 by 22,512 contracts to 138,389, the U.S. Commodity Futures Trading Commission (CFTC) said.