Oil steady near $70 as China demand offsets concerns about trade

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Prices rose on the data, with USA crude futures up 53 cents to $61.93 per barrel as of 10:53 a.m. EDT.

Trump tweeted on Sunday that the United States would raise tariffs on US$200 billion (RM829 billion) worth of Chinese goods this week, causing investors to seek safety and flee from risky assets. "'Don't do business with this people until they understand that there is a way to that you conduct yourself in the global community'".

Olivier Jakob, managing director of Petromatrix, said, "There is no true sign of weakness in the physical market; you have lower exports from Venezuela, you've got sanctions from Iran, Libya which is still a risk".

"We've seen that market tighten up considerably even before the Iranian information, and we are also seeing a range of refining problems in the USA", said Ryan Fitzmaurice, energy strategist at Rabobank.

Restrictions on Iran, as well as on Venezuela, come amid already tight supply as the OPEC has been withholding output this year.

Last week, the mood among gold investors turned gloomy, pushing the metal to a four-month low after the U.S. Federal Reserve Chairman Jerome Powell dashed hopes of a rate cut this year. The chart shows crude exports of the US and Iran.

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EIA also forecast that crude oil production in the Organization of the Petroleum Exporting Countries (OPEC) will average 30.3 million barrels per day (b/d) in 2019 and 29.8 million b/d in 2020, compared with an average of 32 million b/d in 2018.

Brent crude oil futures shed $1.31 or 1.8%, at $69.93 a barrel.

Saudi Arabia, the world's biggest oil exporter, cut the pricing for June supplies of all crude grades to the United States, while raising it for other regions.

Most analysts expect Iran's exports to fall to a little more than 500,000 bpd from about 1 million bpd in April. India imported 23.9 mt of crude oil from Iran in FY19, making the Gulf country the third biggest exporter of oil after Iraq and Saudi Arabia. Oil prices tend to follow moves in equities, and demand for the USA dollar-linked commodity often increases when the greenback slips.

Today's EIA Weekly Inventories report is expected to show a 1.1 million barrel increase.

"Nonetheless, the probability of renewed escalation of the U.S". -China trade negotiations. Also, don't look for a rally if stocks remain under pressure.