Oil market cheers US-China trade headlines

OANDA:BCOUSD   Brent Crude Oil
After a brief pause on Thursday, oil prices resumed the ascent and rose 1% today. The bulls are cheering the easing fears about prolonged oversupply after the POEC report showed the cartel production fell sharply in December. This fact suggests that producers could take strong efforts within a new deal amid the prospects for lower oil demand against the backdrop of slowing economy.

The speculations about the possible lifting some tariffs imposed on Chinese buoyed financial markets and gave a lift to oil prices as well. Despite the rumors were denied, investors continue to raise hopes for resolving the trade issues between the two countries that proceed to another phase of negotiations in late January.

Global investor sentiment continues to set the tone for Brent that has become more sensitive to risk trends recently. Brent poised for weekly gains of more than 2% after two weeks of strong recovery. Technically, the prices need to overcome the $62.50 resistance to target the $65 handle. But at the moment, there bulls have no enough incentive to push the contracts aggressively higher. Moreover, further attempts to break above $62 could attract a partial profit-taking in the near term.