Crude oil prices edged up to within touching difference of a five-month high on Monday after robust data from the U.S. housing market and reports of massive potential purchases of U.S. crude by China helped ease any near-term fears about the strength of worldwide demand.
By 11:25 AM ET (1525 GMT), U.S. crude futures were up 1.1% at $42.47 a barrel, while the worldwide benchmark Brent was up 0.6% at $45.06 a barrel.
Both had responded positively in line other risk assets to figures showing the National Association of Home Builders’ housing market’s index matching its all-time high in August.
Gasoline RBOB futures meanwhile rose 2.3% to $1.2735 a gallon, near the highest of their recent trading range.
That came on the rear of a report by Reuters which cited unnamed sources as saying that Chinese buyers were preparing to announce major purchase contracts for U.S. crude within the near future.
If borne out, the reports would both provides a supportive picture for overall global demand, and reduce the danger of problems in U.S.-China trade relations hitting the worldwide economy as they did in 2019.
However, the comments were crazy a pinch of salt by many, coming at an equivalent time because the two countries called off a potentially embarrassing review of their ‘phase 1’ trade deal. Official data show Chinese purchases of U.S. oil and LNG lagging far behind promised volumes thus far this year.
Other data points over the holiday offered conflicting deals. The Commodity Futures Trading Commission’s data on Friday suggested that speculative buying of crude had fallen within the last week, while Baker Hughes weekly rig count fell by another 4 to a fresh multi-year low, suggesting that OPEC-led price competition on U.S. shale will have an enduring effect.
Read: Becton, Dickinson and Company.
Oklahoma-based Chaparral Energy (NYSE:CHAP) became the newest U.S. Shale Company to file for phase 11 out of debt earlier Monday.