Crude Oil Rises Ahead Of Crucial US-China Trade Talks

U.S. West Texas Intermediate (WTI) futures traded 0.90% higher at $65.16 per barrel on Monday morning.

Crude oil prices rose 0.90% on Monday ahead of the scheduled trade talks between U.S. and Chinese government officials in London that intend to resolve ongoing disputes and get assurances for critical rare earth resources.

The U.S. is seeking to regain access to rare earth resources from China, National Economic Council Director Kevin Hassett confirmed in an interview.

U.S. West Texas Intermediate (WTI) futures traded 0.90% higher at $65.16 per barrel, compared to its closing price of $64.58.

Brent futures rose 0.65% to $66.90 per barrel.

“Positioning data shows a sharp rise in WTI longs and significant short covering — implying we may need more than technical momentum to push prices meaningfully higher from here,” Rebecca Babin, a senior energy trader at CIBC Private Wealth Group, told Bloomberg.

Investor sentiment reflected some concerns ahead of talks in the morning – the Dow Jones index was down 0.07% at the time of writing.

Crude oil prices have staged a recovery since falling below the $60 level earlier in April, driven by global macroeconomic concerns induced by Trump's tariffs.

This also builds on the momentum from the previous week, after crude oil futures closed the week with gains of over 3%.

Stronger-than-expected jobs data has also reinforced confidence about a resilient U.S. economy, pushing the S&P 500 to over 6,000 for the first time since February.

While analysts at ING pointed to strong economic data as one reason for the rise in crude oil prices, they also underscored that speculators are contributing to the price increase.

“It’s no surprise that with the market moving higher, speculators increased their net long in oil. Speculators bought 42,496 lots in NYMEX WTI over the last reporting week, leaving them with a net long of 163,078 lots as of last Tuesday,” ING said in a recent note.

The United States Oil Fund LP (USO) rose 0.59%, while the ProShares Ultra Bloomberg Crude Oil (UCO) surged 1.22% at the time of writing.

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