West Texas Intermediate fell 2.48 percent on Thursday as US President Donald Trump confirmed he would not meet the Chinese President before the tariff deadline. Despite some positive comments in the last two weeks about the state of the talks, the chances of a positive outcome were dealt a heavy blow by the fact there would be no high-level meetings. The deadline to reach a deal is March 1 and as per the White House’s economic adviser the US and China still have a pretty sizeable distance to go.
Venezuelan supply disruptions had prevented prices from falling earlier in the month, but as international pressure mounts on the Maduro government appears to be short lived.
Weekly crude stocks in the US were mixed keeping crude above $53 but as concerns rise on a lack of an agreement between the US and China would signal further global growth downgrades.
The OPEC agreement with major producers to cut output remains the biggest factor in keeping crude from falling further, but it remains to be seen how it for long it will last. Libyan production is expected to rise after the army took control of Sharara the largest oil field in the nation. Libya is exempt from production cuts given the armed unrest that was disrupting their energy operations.