Oil steady as easing US-China tension, US stockdraw support


May WTI crude oil futures settled at $63.51, up $0.50 or +0.79%.

Futures were little changed in NY.

The decline in U.S. stockpiles has boosted optimism that surging shale output may not thwart Organization of the Petroleum Exporting Countries's (OPEC) efforts to drain a glut.

Oil fell after China said it would levy tariffs on $50 billion of USA imports in retaliation against measures by President Donald Trump, fanning concerns that economic growth and fuel demand could be hurt. Still, government data due on Wednesday is forecast to show stockpiles rose for the fifth time in six weeks.

Oil cartel Opec member Qatar's energy minister told Reuters the organisation should stay the course in its joint cuts with non-Opec members led by Russian Federation to allow increased investment in the oil industry. Markets were rattled by concerns over a brewing trade war between the U.S. and China, but managed to recover from steep early losses.

"OPEC's production cuts are working and we are seeing a steady decrease in a global supply glut", Ahn Yea Ha, a commodities analyst at Kiwoom Securities, said by phone.

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West Texas Intermediate for May delivery was $63.28 a barrel on the New York Mercantile Exchange, down 23 cents, at 08:35. Total volume traded was 12 above the 100-day average.

Front-month Brent crude for June delivery was virtually unchanged at $68.01 at 9.35am GMT. The global benchmark crude traded at a $4.62 premium to June WTI.

Futures in NY slipped as much as 2.1 percent to the lowest intraday price since March 20.

Output from the 14 members of OPEC dropped to 32.04 million barrels a day in March, the lowest since last April, according to a Bloomberg News survey.

Though this was largely thanks to the inexorable slide in Venezuela's oil production, figures are figures and the market is prone to take them at face value. But prices rebounded after USA crude inventories fell by 4.6-million barrels last week, compared with analysts' expectations for an increase of 246,000 barrels, according to Energy Information Administration (EIA) data.