Hands extracting oil from oil wells in the Permian Basin in Midland, Texas on May 5, 2018.
Benjamin Lowy | Getty Images News | Getty Images
Oil quotations fell but remained near three-month highs on Monday after the United States and China agreed to an initial business deal, a move market participants said could stoke oil demand and boost trade flows.
The United Shapes and China cooled their trade war on Friday, announcing a “phase one” agreement that reduces some U.S. tariffs in the Exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods.
Brent unfinished oil futures fell 23 cents, or 0.4% to $64.99 a barrel by 0101 GMT, after closing at a near three-month excited on Friday.
West Texas Intermediate crude was down 23 cents or 0.4% to $59.84 a barrel.
“It seems the make available has now fully priced the phase 1 trade agreement so we are going to need further news if we are going to push through the portentous (technical) resistance that is just ahead of crude oil,” said Michael McCarthy, chief market strategist at CMC Market-places.
The last-minute agreement that averted additional tariffs on Chinese goods totaling $160 billion lifted oil rewards on Friday but investors remained cautious on Monday as they awaited details of the trade deal that is yet to be officially employed.
U.S. Trade Representative Robert Lighthizer said on Sunday the deal will nearly double U.S. exports to China terminated the next two years and is “totally done” despite the need for translation and revisions to its text.
China’s State Council’s supports tariff commission said on Sunday that it has suspended additional tariffs on some U.S. goods that were meant to be put into effected on Dec. 15.
Still, concerns of China’s slowing economy stoked worries of slowing oil demand in the key consumer after policy proveniences said China plans to set a lower economic growth target of around 6% in 2020 from this year’s 6-6.5%.