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UPDATE 5-Oil prices fall about $1 on trade talks uncertainty

Published 19/11/2019, 03:31 am
© Reuters.  UPDATE 5-Oil prices fall about $1 on trade talks uncertainty
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* Prices decline after rally last week

* Investors look to U.S.-China talks, OPEC supply deal

* Concerns over plentiful supplies weigh on market (Updates prices, adds commentary, changes dateline to HOUSTON; previous SINGAPORE/LONDON)

By Collin Eaton (NYSE:ETN)

HOUSTON, Nov 18 (Reuters) - Oil prices eased on Monday, giving up some of last week's gains and edging lower alongside U.S. stocks on uncertainty over a trade deal between the United States and China.

Concerns about plentiful crude supplies in 2020 also weighed on the market, which expects OPEC to extend production cuts in early December to help avoid a new global glut.

Brent crude futures LCOc1 fell $1.15, or 1.82%, to trade at $62.15 per barrel at 10:21 a.m. CST . West Texas Intermediate (WTI) crude CLc1 was at $56.83 a barrel, down 89 cents, or 1.54%.

Wall Street's main stock indexes fell from last week's record highs in early trading following a report that stoked concerns a U.S.-China trade deal might not get through. earlier rise in oil prices "broke with the equity market," said Phillip Streible, senior market strategist at RJO Futures in Chicago. "There has been some pessimism about the trade talks, and the market had the rug pulled out from under it."

The 16-month trade war between the world's two biggest economies has slowed global growth, prompting analysts to lower forecasts for oil demand growth and raising concerns that a supply glut could develop in 2020.

China and the United States had "constructive talks" on trade in a high-level call on Saturday, state media Xinhua reported on Sunday, but it gave few other details. Monday, CNBC quoted a Chinese government source saying the mood in Beijing about a trade deal was pessimistic due to President Donald Trump's reluctance to roll back on tariffs. of lower seasonal demand for gasoline in the U.S. also weighed on oil prices, said Andy Lipow, president of Lipow Oil Associates in Houston.

"Refiners are returning from maintenance as we go into a weaker demand period for gasoline," Lipow said.

The Organization of the Petroleum Exporting Countries (OPEC) said last week it expected demand for its oil to fall in 2020, supporting a view that there is a case for the group and other producers like Russia - collectively known as "OPEC+" - to maintain limits on production. and its allies are expected to discuss output policy at a meeting on Dec. 5-6 in Vienna. Their existing production deal runs until March.

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