Oil prices have made gains after the United States and China formally signed the previously negotiated phase one trade deal.

According to Reuters, Brent futures rose $0.36 to $64.36 a barrel, while US West Texas Intermediate (WTI) crude was up by $0.22 at $58.03 a barrel.

It said that the US crude inventories fell more than expected after the signing of the initial trade deal.

PVM oil broker Tamas Varga said: “The interim deal has done the trick for the time being, but we can be sure that as talks about phase two get underway we shall see more twist and turns.”

Under the interim trade deal between the economies, China agreed to purchase over $50bn more of US oil, LNG and other energy products over two years.

According to the Energy Information Administration (EIA) data, oil inventories fell by 2.5 million barrels, gasoline stocks were up by 6.7 million barrels, and distillate stocks rose by 8.2 million barrels.

Energy Aspects oil analyst Virendra Chauhan said: “It was a formal signing of something which had already been agreed, but that has certainly boosted sentiment.”

Meanwhile, analysts have said that oil prices are returning to range trading, as the US-Iran threat recedes further following the missile and drone attacks that took place earlier this month.

Multinational investment bank UBS said that it expects to see Brent trading at a range of $60-$65 per barrel in the first half of this year, until such time as there aren’t any production disruptions due to the Middle-East tensions.