A day after plunging sharply following a report from the International Energy Agency that showed a record crude output in August, crude oil prices edged higher on Friday, amid concerns about possible supply disruptions due to the impact of hurricane Florence and on upcoming U.S. sanctions on Iranian oil.
However, crude oil’s gains were just modest as traders were weighing the likely impact of U.S.-China trade dispute on oil demand. According to reports, U.S. President Donald Trump has instructed his aides to impose tariffs on $200 billion worth of Chinese products, adding to the already $50 billion in place. This follows his threat last week to impose another $267 billion on China’s exports to the US.
Crude oil futures for October delivery settled at $68.99 a barrel, up $0.40, or 0.6%, for the session.
On Thursday, oil futures ended down $1.78, or 2.5%, at $68.59 a barrel.
For the week, oil futures gained 1.8%.
In its monthly report released on Thursday, the IEA also said that production may drop going forward due to falling output from Iran and Venezuela. It also said that oil prices could break out above $80 a barrel unless other producers act to offset deepening supply losses from these two countries.
It’s uncertain whether Saudi Arabia and other producers will fill any shortfall, or how far they’re able to do so, the agency said.
The monitoring committee set up by OPEC and non-OPEC producers is scheduled to meet in Algiers on September 23 to discuss a new production strategy.