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  • Latest headlines surrounding US-China trade conflict help oil rise on Monday.
  • Drone attack on  Saudi oil facility by Yemen’s Houthi forces causes supply disruptions.

Crude oil prices gained traction on Monday and the barrel of rose to a fresh five-day high of $56.05 earlier in the day. With the trading action turning subdued in the second half of the day, the WTI started to consolidate its gains and was last seen trading at $55.50, gaining 1.3% on a daily basis.

Risk-on flows help oil recover

The Trump administration on Monday announced that it decided to delay the ban on Huawei for 90 days to revive hopes of the US and China making forward progress in next round of trade talks in Washington next month and also eased fears over dismal energy demand outlook to provide a boost to crude oil prices.

In the meantime, reports of Yemen’s  Houthi forces attacking a Saudi oil facility using drones and causing fire at a plant caused the tension in the Middle-East to escalate and supported crude oil rebound by hinting at possible supply disruptions.

Later this week, the weekly crude oil stock reports published by the American Petroleum Institue (API) and the US Energy Information Administration (EIA) will be watched closely by investors.

Technical levels to watch for