Oil prices have increased toward $57 a barrel following news that China and the US would hold talks to put an end to a trade war.
Brent crude LCOc1 increased 84 cents to $56.79 a barrel, while US crude oil CLc1 rose 81 cents at $47.90, Reuters reported.
A survey by the news agency showed that the Organisation of the Petroleum Exporting Countries (OPEC) reduced crude output in December, and the American Petroleum Institute (API) reported a decrease in US crude inventories.
PVM oil broker Stephen Brennock said: “Jitters over the health of the global economy look set to endure but are being lost on the oil market, at least for the time being.”
Prices also gained support from the latest supply report released by the API industry group, which revealed a decline in US crude stocks by 4.5 million barrels last week.
Despite growing worries that the trade war between China and the US will lead to a global economic slowdown, both benchmarks are set to achieve solid gains in the first week of this year.
China’s commerce ministry said it would hold vice-ministerial trade talks with US counterparts in Beijing on 7 and 8 January.
On its website, the ministry said that the upcoming talks are aimed at ‘implementing the important consensus’ reached by the two leaders, BBC reported.
For most of the past year, China and the US have been locked in a trade dispute disrupting the flow of goods, raising concerns of slowing growth and unstable financial markets.
In December, OPEC, Russia and other non-members agreed to reduce supply by 1.2 million barrels a day this year.