Oil declines amid concern over US-China trade talks

London, UK – Oil fell for a third day on Wednesday amid concerns over the US-China trade dispute, and signs of another increase in American crude stockpiles.

Futures declined as much as 1.1 per cent in New York on Wedneday. President Donald Trump’s speech on Tuesday disappointed investors after he gave little insight on how the impasse with Beijing will be resolved, and warned of higher tariffs if a deal can’t be reached.

While crude prices have picked up over the past month, they’re still down about 15 per cent from the peak reached in April as the prolonged US-China trade dispute saps an alreadyfragile global economy, crimping fuel demand. OPEC, which cut production this year to prop up the market, has signaled it’s unlikely to take stronger action to prevent a renewed glut in 2020.

“The market was none the wiser following President Trump’s speech,” said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA. “Concerns over USChina trade relations, as well as speculation around what OPEC might decide to do about supply cuts come early December, continued to linger.”

West Texas Intermediate (WTI) for December delivery fell 45 cents, or 0.8 per cent, to US$56.35 a barrel on the New York Mercantile Exchange as of 9:04am local time on Wednesday.

Brent for January dropped 61 cents, or 1 per cent, to US$61.45 a barrel on the London-based ICE Futures Europe Exchange, and traded at a US$5.05 premium to WTI for the same month.