"U.S. oil prices rose to a three-month high Tuesday, fueled by production cuts from Saudi Arabia and other producers and continued optimism over U.S.-China trade negotiations", according to a story in yesterday's Wall Street Journal.
"...U.S. stock markets edged higher most of the session Tuesday after a three-day weekend, as investors focused on another round of U.S.-China trade talks that moved back to Washington this week from Beijing. Those gains seemed to create broad-market risk appetite, pushing oil prices higher."
"“Much of the near-term outlook continues to focus on trade talks between the U.S. and China, with a recent turn towards more optimistic rhetoric helping to alleviate some of the broad demand concerns hanging over the market in recent months,” said Robbie Fraser, global commodity analyst at Schneider Electric in Louisville."
"Oil prices could continue to take their cues on the U.S.-China trade issue from stock markets, said Michael Poulsen, analyst at consulting firm Global Risk Management. “In the short run, it’s macro driven and also strongly linked to developments in equities,” he said", reports the Jouranl Story.
"Crude-oil volumes shipped from major producer Saudi Arabia fell in the first half of February to 6.2 million barrels a day, down 1.3 million barrels a day from the previous month, according to data published by ship tracking firm Kpler on Monday. The data confirmed comments from the kingdom’s oil minister who said earlier this month that the country would further cut output. Kpler data showed fewer shipments had been destined for the U.S., India, Thailand and South Korea in particular. “There is also evidence that Saudi Arabia has increased refinery throughput so far through February,” said Kpler, adding that departures of oil products have spiked to 1.56 million barrels a day, up 0.19 million barrels in the month."
"Cuts implemented at the start of the year by the Organization of the Petroleum Exporting Countries and its allies, led by Russia, are having an impact, with Saudi Arabia exceeding its targets, analysts said. “Saudi Arabia’s production cuts by more than the required level also serve to offset the lack of compliance by countries like Iraq,” said Commerzbank in a daily note. The OPEC and non-OPEC joint ministerial monitoring committee, or JMMC, which monitors participating countries’ conformity levels to the cuts agreement, is due to meet in Azerbaijan on March 18..." says the WSJ.
To read the original Wall Street Journal Article, go to: https://www.wsj.com/articles/oil-hits-three-month-high-on-tightening-supply-11550574280