Reuters: Oil mixed as U.S.-China trade dispute weighs, but sanctions keep market tense

09:00, 07 May 2019
Economy
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REUTERS

Brent crude oil futures were at $71.28 per barrel at 0443 GMT, 4 cents above their last close, Reuters said.

U.S. West Texas Intermediate (WTI) crude futures were at $62.44 per barrel, 18 cents, or 0.3 percent above their last settlement.

Traders said prices weighed by stalling trade talks between the United States and China would weigh on global economic growth and dent fuel consumption.

Read alsoReuters: Oil tumbles after Trump threatens new tariffs on Chinese goods

Talks between the world's two biggest economies hit a wall over the weekend, when U.S. President Donald Trump announced a raft of new import tariffs on Chinese goods.

Tanker brokerage Eastport said in a note that "worsening trade friction between Washington and Beijing poses a downside risk to our forecasts" for petroleum products.

On the supply-side, oil markets remain tense as the United States tightens sanctions on Iranian oil exports, saying on Monday it was boosting its military presence in the Middle East.

Iran has threatened "reciprocal actions" against U.S. sanctions, which could mean restarting some of its nuclear program.

The U.S. sanctions have already halved Iranian crude oil exports over the past year to below 1 million barrels per day (bpd), and shipments to customers are expected to drop to as low as 500,000 bpd in May as sanctions tighten.

Beyond Iran, Washington has also placed sanctions on the Venezuelan government under President Nicolas Maduro, disrupting supplies from the country, a founding member of the Organization of the Petroleum Exporting Countries (OPEC).

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