HG MARKETS:

Oil prices increased on Monday following the announcement from both parties in U.S.-China trade discussions over the weekend, highlighting their advancements which boosted market optimism that the two largest crude consumers might be approaching a solution to their trade conflict. Brent crude futures rose by 43 cents, or 0.67%, to reach $64.34 per barrel. U.S. West Texas Intermediate (WTI) crude futures were priced at $61.50 a barrel, an increase of 48 cents, or 0.79%, compared to Friday’s closing value. Both benchmarks increased by more than $1 on Friday and saw a rise of over 4% last week, marking their first weekly gains since mid-April, following a U.S. trade agreement with Britain that bolstered investors’ hopes of evading economic disruptions caused by U.S. tariffs on trade partners. On Sunday, trade discussions between the United States and China concluded positively, with U.S. representatives promoting a “deal” aimed at decreasing the U.S. trade deficit, while Chinese representatives indicated that both sides achieved an “important consensus.”

Nonetheless, both parties refrained from disclosing any specifics of the discussions with Chinese Vice Premier He Lifeng, stating that a joint statement would be released on Monday. Constructive discussions between the two leading global economies might enhance crude demand as trade, presently hindered by substantial tariffs imposed by each nation, is resumed between them. Tazawa was mentioning proposals by the Organization of the Petroleum Exporting Countries and its partners, collectively called OPEC+, to speed up production increases in May and June, which will introduce additional crude into the market. Nonetheless, a Reuters poll indicated that OPEC oil production slightly decreased in April.

Furthermore, discussions between Iranian and American negotiators to address disagreements regarding Tehran’s nuclear program concluded in Oman on Sunday, with additional talks scheduled, officials announced, while Tehran openly maintained its commitment to ongoing uranium enrichment. A nuclear agreement between the U.S. and Iran might ease worries regarding diminished global oil supply, which could also put pressure on oil prices. Last week, U.S. energy companies reduced the count of oil and natural gas rigs in operation to the lowest level since January, according to energy services firm Baker Hughes (NASDAQ:BKR) on Friday.