Investing.com - Oil prices climbed on Monday morning in Asia, recovering from steep drops last week.
London-traded Brent crude, the global oil benchmark, was up 0.65% to $65.31 by 10 PM ET (3:00 AM GMT).
New York-traded West Texas Intermediate gained 0.45% to 56.05.
Oil prices were pushed down last week by declines in manufacturing index data in both the U.S. and China as well as rising crude output in the U.S. Brent crude fell 1.9% on Friday and as much as 3% for the week while WTI crude last 2.6% for the week.
The Wall Street Journal reported Sunday night that the U.S. could move to lift most or all tariffs on Chinese imports and that U.S. President Donald Trump and Chinese President Xi Jinping could meet to sign a trade deal as early as this month.
The news helped lift stocks markets throughout Asia and pushed down gold and the dollar. The same news also helped boost oil prices, which clawed back some of the ground lost last week.
The prospects of a resolution to the long-standing China-U.S. trade dispute is sure to shore up oil prices, but investors are also likely to focus on supplies of crude.
U.S. production has risen rapidly over the last year to 12.1 million barrels per day (bpd) even as the Organization of the Petroleum Exporting Countries (OPEC) and some of its non-affiliated partners like Russia, have cut output by 1.2 million bpd to support prices. The OPEC cuts helped stem a freefall in oil prices at the end of 2018.
A survey by Reuters found that the supply of crude from OPEC fell in February to a four-year low.
“OPEC exports are off by over 1.5 million barrels per day (bpd) since November,” said Barclays (LON:BARC) bank in a note quoted by Reuters.
Sanctions against Iran and Venezuela, both OPEC members, have also helped lift prices this year. Since Jan. 1, Brent crude has gained around 17% and WTI crude has gained about 18%.
Later this week, investors will look to numbers from the American Petroleum Institute on supplies on Tuesday and a report from the U.S. Energy Information Administration on stockpiles on Wednesday. On Friday, Baker Hughes is expected to release its weekly count of active oil rigs in the U.S.