Oil slips amid anxiety about trade talks

Tokyo — Oil prices fell on Friday, with Brent slipping away from the $70 mark reached the previous day, pulled down by worries about progress in the US-China trade talks.

International benchmark Brent futures dropped 15c, or 0.2%, to $69.25 a barrel by 0455 GMT, having touched $70.03 in the previous session, the highest since November 12.

US West Texas Intermediate (WTI) crude was down 1c at $62.09. The contract fell 36c in the previous session, having hit $62.99 on Wednesday, its highest since November 7.

Weighing on prices are concerns that an economic slowdown could dent fuel consumption, traders said.

The US and China, the world’s two biggest oil consumers, could be close to a deal to end their trade dispute though some hurdles remain.

US President Donald Trump on Thursday said the two sides were “very close to making a deal”, though the US remains hesitant to lift $250bn in tariffs that China is seeking to have removed.

Prices for thermal coal and natural gas, the main power generation fuels, have already fallen sharply amid a marked slowdown in consumption.

Still, Brent is heading for a second week of gains, while WTI is on track for a fifth consecutive weekly rise.

Brent has gained nearly 30% in 2019, while WTI has risen nearly 40%, underpinned by production cuts and US sanctions against Iran and Venezuela.

The Organization of the Petroleum Exporting Countries (Opec) and producer allies such as Russia, together known as Opec+, agreed to cut output by 1.2-million barrels per day (bpd) this year to prop up prices.

Consultancy Rystad Energy said ongoing Opec-led supply cuts would support oil prices towards the second half of this year and into 2020.