Oil prices saw small moves today as markets await a key update with the US-China trade war. The pessimistic outlook for global growth should be temporary as both sides remain motivated to push through a deal. The short-term risks for oil remain to the upside as output at risk remains high due to the sanctions on Venezuelan and Iranian oil, along with disruptions with Libyan crude.
Many analysts see oil markets becoming balanced this year, followed by a deficit in 2020. Tight supplies should keep oil supported, but growing production from Cushing will likely cap any West Texas Intermediate crude gains above the $70 a barrel level.
In the short-term crude could stabilize further here on tightness with the overall global crude balance and optimism that demand side of the argument will get a boost from eventual trade deal from the Chinese and US.
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