Oil Rises As Russia Mulls Tighter Gasoline Export Limits Amid Trade Talks

Oil prices rose in early Asia trading hours on Friday as optimism surrounding trade deals bolstered the global economic outlook, and reports indicated that Russia was considering curbing gasoline exports.

Benchmark Brent crude prices rose 0.6% to $69.61 per barrel, while U.S. West Texas Intermediate crude prices gained 0.6% to $66.44 per barrel at 2.29 GMT. Reuters reported on Thursday that Moscow was planning to impose tighter export restrictions on gasoline to lower prices. 

A larger-than-expected drop in U.S. crude inventories, along with optimism surrounding potential trade deals, including those between the U.S. and the EU, also boosted investor confidence in the contracts. Retail sentiment on Stocktwits about the United States Oil Fund (USO) remained in the ‘bearish’ territory.

The potential Russia curbs helped offset concerns about a possible restart of Chevron’s operations in Venezuela. According to a report by The Wall Street Journal, the Trump administration has approved the company to resume oil pumping in Venezuela following recent talks.

According to a Reuters report, Tony Sycamore, an analyst at IG, said, "I am encouraged by the way crude oil held and bounced away from the $65/64 support band this week, which keeps hopes intact of a rebound back towards $70."

Separately, U.S. Energy Information Administration data revealed that crude inventories in the world’s largest economy fell by 3.2 million barrels to 419 million barrels last week, marking a larger-than-expected drop. U.S. gasoline stock also fell by 1.7 million barrels, exceeding estimates.

Investors are also looking at other potential trade deals between the U.S. and its key partners, including India. Sycamore reportedly said that next week will be a ‘big week’ data-wise, as crucial Chinese factory activity data and key U.S. figures such as inflation, jobs, and inventory data could signal where oil demand is headed in the near term.

Also See: India Wants Tariff Edge Over Rivals As Commerce Minister Hails ‘Exceedingly Good’ Progress With US Trade Talks

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