Oil drops 1 percent on US-China trade talks, American supply surge

Oil Surges Above $52 on Saudi Assurances China Trade OptimismMore

Oil Surges Above $52 on Saudi Assurances China Trade OptimismMore

Crude oil futures ended notably lower on Friday, snapping a nine-day winning streak, with profit taking and worries about slowing Chinese economy weighing on the commodity. Futures for the S&P 500 index fell 0.1 percent to 2,591.60 and those for the Dow were flat at 23,949.00.

MSCI's all-country index .MIWD00000PUS climbed 1.03 percent for a fourth day of gains. But industrial companies rallied after US negotiators said China had agreed to buy more energy and agricultural products and manufactured goods.

Stocks have rallied this week, helped by promises of patience from the Federal Reserve, the European Central Bank mulling more cheap money, and progress in trade talks between Washington and Beijing.

Meanwhile, the market is watching closely on the development of trade talks between China and the United States.

Wall Street ended little changed on Friday, taking a breather following a five-day winning streak, while the dollar rebounded against most currencies from earlier losses tied to expectations the US central bank is in no hurry to raise interest rates.

Asian markets are mostly higher as investors cheer more...

Both oil price benchmarks had jumped by around 5 percent the previous day as financial markets around the world surged on the hopes that Washington and Beijing may be able to soon end their trade disputes, soothing fears of an all-out trade war between the two biggest economies and its possible impact on global growth.

ANALYST'S TAKE: "While there was agreement on less thorny issues such as agriculture and energy, US demands for verification and enforceable targets on intellectual property rights, transfer of technologies and non-tariff barriers may not be that easily addressed", DBS Group Research strategists Eugene Leow and Neel Gopalakrishnan said in a commentary.

CHINESE INFLATION: On Thursday, China released consumer and producer inflation figures that missed the mark. It posted a weekly increase to 2.9 percent, which was its strongest such rise in six weeks.

Benchmark 10-year notes US10YT=RR were last down 2/32 in price to yield 2.7225 percent after earlier rising to 2.747 percent, the highest since December 28. The contract is has surged by 23.7 percent since December 24.

West Texas Intermediate for February delivery traded 20 cents higher at $52.79 a barrel on the New York Mercantile Exchange as of 4:01 p.m.in Singapore on Friday.

Oil headed for its biggest weekly gain in over two years on hopes that OPEC will manage to shrink a glut and trade tensions between the USA and China will ease.

Brent crude LCOc1 was down almost 1%, or $0.60, to $60.84 per barrel at 1400 GMT.

Brent oil started the week at $57.84 per barrel at 06.45 GMT on Monday while WTI registered at $48.73 a barrel. It gained 24 cents to $61.68 per barrel in London. The euro rose to $1.1559 from $1.1543.

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