Oil prices have declined more than 1% due to the lack of any clear resolution to the trade talks between the US and China.
International Brent crude futures LCOc1 fell 1.3% at $60.65 a barrel, while US West Texas Intermediate (WTI) crude oil futures CLc1 were at $51.66 a barrel, a decrease of 1.3%, Reuters reported.
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In addition, official data again indicated large fuel stocks in the US led to a reduction in oil prices.
The latest negotiations between both countries concluded with mildly positive statements from both sides.
In a statement, the US Trade Representative’s offices said that the two sides discussed ‘ways to achieve fairness, reciprocity and balance in trade relations’.
Singapore-based Vanda Insights founder Vandana Hari told Reuters that oil prices dropped ‘as optimism fueled by the US-China trade talks earlier in the week appeared to have run its course, and official statements after the conclusion of three days of negotiations, while indicating modest progress, lacked details’.
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By GlobalDataMeanwhile, US bank Morgan Stanley reduced its 2019 oil price forecasts by more than 10% this week, due to weakening economic growth expectations and rising oil supply, especially from the US.
According to the Energy Information Administration, US crude oil production remained at a record 11.7 million barrels a day in the week ending 4 January, which resulted in swelling fuel inventories.
An increase in US production runs counter to the Organization of the Petroleum Exporting Countries-led efforts to reduce supply and stop an emerging glut.
