By Sharon Cho and Grant Smith

Dec 13, 2019

(Bloomberg) Oil rose to $60 a barrel for the first time in almost three months after U.S. President Donald Trump signed off on a partial trade deal with China, giving a boost to the fragile outlook for global oil demand.Futures climbed 1.4% in New York, reaching $60 for the first time since Sept. 17, and are on track for a slight weekly increase. The phase-one agreement averts new U.S. tariffs that were set to be introduced Dec. 15, although the legal text hasn’t been finalized, according to people familiar with the matter.

U.S. oil futures rise to $60 after trade deal sign-off

Crude is poised for a modest gain this week due to the positive sentiment around the trade deal, having surged by more than 7% last week as OPEC and its allies announced a surprise production cut. Yet as the details of the U.S.-China agreement remain scarce, and concerns linger over whether OPEC will follow through on its agreement, the sources of support for prices appear fragile.

See also: Commodities Enjoy Best Week in 5 Months as Trade Deal Struck

“Risk appetite among financial investors is now likely to remain high thanks to the deal between the U.S. and China,” said Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt. Yet “the oil market risks facing a massive over supply and a pronounced inventory build, at least in the first half of the year.”

West Texas Intermediate for January delivery rose 82 cents to $60 a barrel on the New York Mercantile Exchange as of 6:48 a.m. local time. Brent for February settlement added 1.7% to $65.27 a barrel on the London-based ICE Futures Europe Exchange. The global benchmark traded at a $5.38 premium to WTI for the same month.

Other oil-market news:
Moody’s Investors Service has a sunny outlook on the global oil and gas industry heading into next year, even as volatile energy prices hammer the sector and add to a mountain of debt. It will take $15 billion in U.S. government funding to help make carbon-capture systems a cost-effective way of trapping global-warming emissions from U.S. power plants and other industrial operations, a group representing oil and gas natural corporations said.

Other oil-market news:

Moody’s Investors Service has a sunny outlook on the global oil and gas industry heading into next year, even as volatile energy prices hammer the sector and add to a mountain of debt.
It will take $15 billion in U.S. government funding to help make carbon-capture systems a cost-effective way of trapping global-warming emissions from U.S. power plants and other industrial operations, a group representing oil and gas natural corporations said.