Oil prices down, markets assess US-China trade talks outcome
TOKYO, June 11 (Reuters) - Oil prices fell in early trade on Wednesday as markets were assessing the outcome of U.S.-China trade talks, yet to be reviewed by President Donald Trump, with weak oil demand from China and OPEC+ production increases weighing on the market.
Brent crude futures lost 24 cents, or 0.36%, to trade at $66.63 a barrel, while U.S. West Texas Intermediate crude fell 21 cents, or 0.32%, to $64.77 at 0119 GMT.
U.S. and Chinese officials agreed on a framework to put their trade truce back on track and resolve China's export restrictions on rare earth minerals and magnets, U.S. Commerce Secretary Howard Lutnick said on Tuesday at the conclusion of two days of intense negotiations in London.
Trump will be briefed on the outcome before approving it, Lutnick added.
"In terms of what it means for crude oil, I think it removes some downside risks, particularly to the Chinese economy and steadies the ship for the U.S. economy - both of which should be supportive for crude oil demand and the price," said Tony Sycamore, a market analyst for IG.
Oil import data from China earlier this week and ongoing production increases from OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, were adding to the downside.
OPEC+ plans to increase oil production by 411,000 barrels per day for July as it looks to unwind production cuts for a fourth straight month.
Meanwhile, China's customs data showed this week the country, the world's biggest oil importer, brought in 46.60 million tonnes of crude oil in May, down 3% from the previous month, with imports of oil products falling by 12.9%.
Later on Wednesday, markets will be focusing on the weekly U.S. oil inventories report from the Energy Information Administration, the statistical arm of the U.S. Department of Energy.
Analysts polled by Reuters expect U.S. crude oil stockpiles fell by 2 million barrels in the week to June 6, while distillate and gasoline inventories likely rose.
Their estimates are for a bigger decline in crude stocks than figures from American Petroleum Institute showed. The API reported on Tuesday that crude stocks fell by 370,000 barrels last week, sources said on condition of anonymity.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
38 minutes ago
- Reuters
Wall Street futures slip as Middle East tensions rise; Boeing falls
June 12 (Reuters) - U.S. stock index futures slipped on Thursday as signs of rising tensions in the Middle East weighed on risk sentiment and investors sought more clarity on Washington's recent trade deals with China. Shares of planemaker Boeing (BA.N), opens new tab lost 7% premarket after an Air India aircraft with more than 200 people crashed in India's western city of Ahmedabad, and aviation tracking site Flightradar24 said the plane was a Boeing 787-8 Dreamliner. President Donald Trump said on Wednesday U.S. personnel were being moved out of the Middle East as it could be a "dangerous place", adding that the United States would not allow Iran to have a nuclear weapon. This comes at a volatile time for the region and just days ahead of a planned sixth round of nuclear talks between Iran and the United States. A senior Iranian official said earlier on Wednesday Tehran will strike U.S. bases in the region if nuclear negotiations fail and conflict arises. China on Thursday affirmed a trade deal with the U.S., strengthening a delicate truce in the trade war that has roiled global markets for much of the year. "Now that a consensus has been reached, both sides should abide by it," Lin Jian, a foreign ministry spokesperson for China, said at a regular news conference. Traders also looked to gain more details on the trade framework discussed by officials from the U.S. and China at a two-day talk in London earlier this week. At 05:37 a.m. ET, Dow E-minis were down 228 points, or 0.53%, S&P 500 E-minis were down 19.75 points, or 0.34%, and Nasdaq 100 E-minis were down 56.25 points, or 0.26% Tesla (TSLA.O), opens new tab shares lost 1.1% and Nvidia (NVDA.O), opens new tab lost about 0.7%. Among other movers, Oracle (ORCL.N), opens new tab shares rose 7.6% after the cloud service provider raised its annual revenue growth forecast citing increased demand from companies deploying artificial intelligence. After a tame inflation report on Wednesday that provided investors with some reprieve, focus will now be on the May Producer Price Index data, which is due at 8:30 a.m. ET, along with initial jobless claims data. "May could be too soon to see the impact of tariffs, but softer demand may also be limiting pass through. We pencil in larger tariff effects starting later in the summer," said Citigroup strategists in a client note. With investor bets increasing on Trump reaching favorable trade agreements with several trading partners in the coming weeks, the benchmark S&P 500 index (.SPX), opens new tab is trading 2% below its record high touched in February. The tech-heavy Nasdaq (.IXIC), opens new tab is about 2.7% from record levels hit in December.
The Independent
40 minutes ago
- The Independent
Exports to US slump at record pace in ‘payback' after rush ahead of tariff hikes
British exports slumped by nearly 9% in April after a record drop in goods exported to the US following President Donald Trump's move to hike tariffs, official figures have shown. The Office for National Statistics (ONS) said the value of goods exported to America tumbled by £2 billion in April – the fastest pace since records began in 1997. The drop was led by machinery and transport, including cars, according to separate trade figures from the ONS on Thursday. The value of goods exports to the US are now at their lowest level since February 2022, it added. In total, exports of UK goods in April fell 8.8%, or by £2.7 billion, to £13.7 billion. It follows four months in a row of rising US exports as American importers stocked up ahead of Mr Trump's tariff rises, which came into effect at the start of April. Imports of goods from the US, including precious metals, also fell in April, down by £400 million. ONS director of economic statistics Liz McKeown said: 'After increasing for each of the four preceding months, April saw the largest monthly fall on record in goods exports to the US with decreases seen across most types of goods, following the recent introduction of tariffs.' Exports to the US of machinery and transport equipment, and material manufactures, both tumbled by £800 million in the month, with car exports heavily down. But the ONS said there was also a significant drop in car exports to the European Union in April, with a £900 million decline for machinery and transport. Overall, total goods exports to the EU fared even worse in April, down by £2.1 billion or 12.6%. Mr Trump unleashed so-called reciprocal tariffs on America's largest trading partners at the start of April, including the UK. Britain has since struck a deal that will see UK exports avoid the worst of the trade duties, with a baseline tariff of 10% and exemptions for some key goods, such as steel and aluminium and removing tariffs on UK aluminium and steel exports. But these tariff reductions have not yet come into effect, with aims to finalise the deal by July 9. Experts said last month saw 'payback' for a rush to beat the US tariff hikes earlier in the year. Sandra Horsfield, an economist at Investec, said: 'Distortions around known deadlines were always going to take place and always going to be followed by payback – no matter where, in the end, tariffs landed. 'The bigger question will be how output fares in the coming months, once these temporary effects fade. 'The UK may have secured an agreement to shelter the first 100,000 of cars (roughly the existing level of its car exports to the US) at lower tariffs than other countries face, but this is yet to be signed off by President Trump. 'What will remain is uncertainty over tariffs more widely and importantly the indirect impact this will have on the UK economy,' she added. The ONS figures showed the total goods and services trade deficit widened by £4.9 billion to £11.5 billion in the three months to April, as the rise in imports outweighed the rise in exports. The trade in goods deficit widened by £4.4 billion to £60 billion in the three months to April, while the trade in services surplus is estimated to have narrowed by £500 million to £48.5 billion.
Reuters
44 minutes ago
- Reuters
TSX futures fall as Middle East tensions weigh on sentiment
June 12 (Reuters) - Futures linked to Canada's main stock index fell on Thursday as optimism over tame U.S. inflation figures waned, while escalating tensions in the Middle East prompted investors to adopt a more cautious stance. June futures on the S&P/TSX index were down 0.3% at 05:30 a.m. ET (09:30 GMT). The Toronto Stock Exchange's S&P/TSX composite index had reached a record closing high on Wednesday after U.S. consumer prices rose less than expected in May, boosting prospects for Federal Reserve interest rate cuts in coming months. Geopolitical concerns dampened investor sentiment on Thursday after U.S. President Donald Trump announced some U.S. personnel were being relocated from the Middle East amid rising tensions with Iran. In commodities, gold prices rose to a one-week high. Copper prices also climbed, while oil prices eased, reversing earlier gains made during Asian trading. Markets faced additional uncertainty as Trump said on Wednesday that he was willing to extend the deadline for trade talks, although he deemed it unlikely, with the U.S. planning to send offer letters to countries in the coming weeks. This week's focus centered on U.S.-China trade talks, which resulted in a deal to restore their truce. Despite the progress, longstanding tensions persisted as some tariffs remained in place. With Trump's July 8 tariff pause deadline approaching, investors are concerned about whether other countries can secure trade agreements with the U.S. In corporate news, Ivanhoe Mines ( opens new tab said it had resumed underground mining in part of its Kakula copper mine in the Democratic Republic of Congo, which had been closed due to seismic activity, but lowered its output forecast for the year. FOR CANADIAN MARKETS NEWS, CLICK ON CODES: TSX market report Canadian dollar and bonds report CA/ Reuters global stocks poll for Canada , Canadian markets directory
