Oil prices steady as market focuses on G20 meeting
Amid a cautious market where investors are keeping a close watch on the highly anticipated meeting between the US President Donald Trump and Chinese President Xi Jinping and next week’s OPEC meeting, oil prices remain steady on Friday.
Brent crude futures dropped 39 cents at $66.16 per barrel by 0245 GMT. The US West Texas Intermediate crude futures dropped 40 cents at $59.03 a barrel.
The leaders of the G20 countries meet on Friday and Saturday in Japan, but the most anticipated meeting is between Trump and Xi scheduled on Saturday. Oil prices have been impacted due to the trade dispute between the world’s two biggest economies. The trade war has fuelled fears that economic slowdown could slowdown the demand of oil.
According to the report of Reuters, ANZ Bank said that while there are no market expectations regarding a truce between the US and China, the meeting between the two countries would set the scene for the OPEC meeting few days later.
The Bank added that even if the trade talks between the two countries are positive, OPEC will extend the production cuts until the end of 2019, however, amid the issues of rising supply, deeper cuts look unlikely.
The US President had said on Wednesday that a trade deal with China was possible, but if the two countries do not agree then he is prepared to impose US tariffs on the remaining Chinese products.
The Organization of Petroleum Exporting Countries (OPEC) and its allies including Russia will meet on July 1-2 in Vienna to decide on the extension of supply cuts.
A commodity analyst told Reuters that market expectation is that OPEC+ will agree to extend cuts, but what matters is how deep the cuts will be and how much Saudi Arabia and Russia will curb.
OPEC+ members have agreed to curb oil output from January 1 by 1.2 million barrels per day.