LONDON, July 24 — Oil prices rose more than one per cent on Thursday, buoyed by optimism over United States (US) trade negotiations that would ease pressure on the global economy and a sharper-than-expected decline in US crude inventories.
Brent crude futures gained 79 cents, or 1.15 per cent, to US$69.30 a barrel by 0934 GMT. U.S. West Texas Intermediate crude futures climbed 83 cents, or 1.3 per cent to US$66.08 per barrel.
"The US crude inventory draw and the trade efforts are adding some support to prices," said Rystad analyst Janiv Shah.
On Wednesday, two European diplomats said that the European Union (EU) and the US are moving towards a trade deal that could include a 15 per cent U.S. baseline tariff on EU imports and possible exemptions, potentially paving the way for another major trade agreement following the Japan deal.
On the supply side, data from the US Energy Information Administration on Wednesday indicated that US crude inventories fell by 3.2 million barrels last week to 419 million barrels, exceeding analysts' expectations in a Reuters poll for a 1.6 million-barrel draw.
Meanwhile, PVM Associates analyst John Evans said in a note that the news of issues in loading CPC exports from Kazakhstan through the Black Sea due to Russian administrative interference, along with reports of contamination around loadings for Azeri crude from Ceyhan in Turkey, led to some strength.
However, he noted that follow-through will depend on their longevity.
Meanwhile, Kazakhstan's energy ministry said that the country had not halted oil loadings via the Russian sea ports, the Interfax news agency reported earlier on Thursday.
"Uncertainty over US-China trade talks and peace negotiations between Ukraine and Russia is limiting further gains," said Nissan Securities Investment chief strategist Hiroyuki Kikukawa, who predicted that the WTI would likely remain range-bound between $60 and $70 a barrel.
Russia and Ukraine held peace talks in Istanbul on Wednesday, discussing further prisoner exchanges, although the two sides remain far apart on ceasefire terms and a possible meeting between their leaders.
"Next to watch would be the demand indicators as we are in the peak season and any upside or downside would impact refining margins," Shah added.
— Reuters
