Oil held firm after the U.S. delayed sanctions against Huawei Technologies Co., offering a hint of progress in its trade war with China, and a drone attack in Saudi Arabia highlighted simmering Middle East tensions.
Futures in New York were down 0.2%, after gaining 2.4% in Monday’s session. The U.S. will extend exemptions for customers of the Chinese telecom giant for another 90 days, Commerce Secretary Wilbur Ross said. The move comes a week after President Donald Trump delayed new tariffs on some consumer goods until mid-December.
Meanwhile, the drone strike by Yemeni rebels on the Shaybah field in Saudi Arabia, the source of about 1 million barrels a day, was a reminder of the continuing threats in the heart of global crude production. The attack sparked only a small fire and no disruption to output, Saudi Arabian Oil Co. said in a statement.
Iran warned the U.S. against targeting a supertanker carrying the Middle East country’s oil as the vessel departed Gibraltar after being seized last month by U.K. forces.
Bets on a WTI crude rally jumped 13% in the week ended Aug. 13 -- the day the U.S. president surprised financial markets with a pause in the trade war with China -- according to data released Friday.
The rivalry between U.S. and Middle Eastern oil producers has jumped up a notch as American crude makes its way right to the heart of Asia, the world’s most-prized energy market.
West Texas Intermediate crude for September delivery eased 11 cents to $56.10 a barrel on the New York Mercantile Exchange as at 8:08 a.m. Sydney time.
September WTI settled $1.34 higher at $56.21 a barrel at Monday’s close. The contract will expire Tuesday. The more active October contract rose $1.33 to end at $56.14 a barrel.
Brent for October settlement increased $1.10 to $59.74 on the ICE Futures Europe Exchange.
Source : Bloomberg