Oil down 1 percent on indecisive U.S.-China trade talks, rising inventories
Oil prices fell about 1 percent on Thursday as no clear signs of a resolution emerged from U.S.-Chinese trade talks and official data again highlighted vast fuel stocks in the United States.
Brent crude was down nearly 1 percent, or 60 cents, to $60.84 per barrel at 1400 GMT. U.S. crude was at $51.65 per barrel, down 71 cents or 1.4 percent.
Both benchmarks rose by around 5 percent the previous day, capping off a week-long climb that marked oil`s longest sustained rise since last summer.
Vandana Hari of consultancy Vanda Insights in Singapore said oil prices dropped "as optimism fuelled by the U.S.-China trade talks earlier in the week appeared to have run its course".
Global financial markets had surged on hopes that Washington and Beijing may soon end their dispute and avert an all-out trade war between the two biggest economies.
But the upbeat mood was dampened after the two sides each issued only mildly positive statements that lacked concrete details, helping end a four-day rally in share markets and pushing the U.S. dollar to a near three-month low.
Elsewhere, U.S. bank Morgan Stanley cut its 2019 oil price forecasts by more than 10 percent on Wednesday, pointing to weakening economic growth expectations and rising oil supply.
The bank now expects Brent to average $61 a barrel this year, down from a previous estimate of $69, and U.S. crude to average $54, against a prior forecast of $60.
The main source of new supply is the United States, where crude oil production remained at a record 11.7 million barrels per day in the week ended Jan. 4, the Energy Information Administration said on Wednesday.
Rising output has led to swelling fuel inventories, and has countered efforts led by the Organization of the Petroleum Exporting Countries to cut supply and rein in an emerging glut.
"We believe it is just a question of time that the actual or perceived supply/demand balance that includes stock level, production data as well as demand figure, will take over," said Tamas Varga of PVM Oil Associates.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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