Oil prices edged lower on Monday, giving up some of last week’s gains, amid uncertainty over a trade deal between the United States and China.
Concerns about plentiful crude supplies in 2020 also weighed on the market, which expects OPEC to extend production cuts in early December to help avoid a new global glut.
Brent crude futures LCOc1 fell 1% or by 62 cents to trade at $62.68 per barrel at 1345 GMT. West Texas Intermediate (WTI) crude CLc1 was at $57.31 a barrel, down 41 cents.
“In the short term, U.S.-China trade talks and (the) OPEC meeting in early December are the two biggest events oil traders are watching for,” Margaret Yang, an analyst at CMC Markets, said.
The 16-month trade war between the world’s two biggest economies has slowed global growth, prompting analysts to lower forecasts for oil demand growth and raising concerns that a supply glut could develop in 2020.
China and the United States had “constructive talks” on trade in a high-level call on Saturday, state media Xinhua reported on Sunday, but it gave few other details.
On Monday, CNBC quoted a Chinese government source saying the mood in Beijing about a trade deal was pessimistic due to President Donald Trump’s reluctance to roll back on tariffs.
In a signal that policymakers are ready to act to prop up slowing growth, China’s central bank unexpectedly trimmed a closely-watched lending rate on Monday, the first such cut in more than four years.
The Organization of the Petroleum Exporting Countries (OPEC) said last week it expected demand for its oil to fall in 2020, supporting a view that there is a case for the group and other producers like Russia – collectively known as “OPEC+” – to maintain limits on production.
OPEC and its allies are expected to discuss output policy at a meeting on Dec. 5-6 in Vienna. Their existing production deal runs until March.
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