Oil Rises as Mideast Tensions Ease

Oil prices rose slightly on Monday as investors shift their focus away from easing Mideast tensions to this week’s scheduled signing of an initial US-China trade deal which could boost economic growth and demand.
Brent crude was up 20 cents at $65.18 per barrel, while West Texas Intermediate crude was up 16 cents at $59.20 a barrel from the previous session, Reuters reported.
Oil prices surged to their highest in almost four months after a US drone strike martyred an Iranian commander and Iran retaliated with missiles launched against US bases in Iraq. But they slumped again as Washington and Tehran retreated from the brink of direct conflict last week.
Global benchmark Brent touched $71.75 per barrel last week before ending on Friday below $65.
Backwardation in Brent, a market structure where prices for near-term contracts are higher than those for later contracts, is currently at 73 cents per barrel, from 84 cent a week earlier, whereas the WTI backwardation is at 5 cents a barrel from 23 cents last week.
Backwardation tends to reflect tightening supplies, and the narrowing of the values indicate that worries over supply disruption are receding.
A US-China trade deal is due to be signed in Washington on Wednesday.
The Trump administration has invited at least 200 people to a ceremony for the signing of the deal, but the two nations have not yet finalized the details of what will be signed.