Oil prices climb after Saudi oilfield attack, but recession worries drag

Crude oil prices rose on Monday following a weekend attack on a Saudi oil facility by Yemeni separatists and as traders looked for any signs that Sino-United States trade tensions could ease.

But price gains were capped by an unusually downbeat OPEC report that stoked concerns about growth in oil demand.

Brent crude LCOc1 was up 64 cents, or about 1.1%, at $59.28 a barrel at 0255 GMT, US crude CLc1 was up 55 cents, or 1%, at $55.42 a barrel.

“Oil is benefiting from an overall optimism that we won’t see the doomsday trade war scenario and after a drone attack on oil and gas facilities in Saudi Arabia reminded markets geopolitical tensions in the Middle East are going nowhere anytime soon,” said Edward Moya, senior market analyst at OANDA in New York.

A drone attack by Yemen’s Houthi group on an oilfield in eastern Saudi Arabia on Saturday caused a fire at a gas plant, adding to Middle East tensions, but state-run Saudi Aramco said oil production was not affected.

Meanwhile, White House economic adviser Larry Kudlow said trade deputies from the United States and China would speak within 10 days and could advance negotiations over ending a trade battle between the two countries if those talks pan out.

But US President Donald Trump appeared less optimistic than his aides on striking a trade deal with China, saying that while he believed Beijing was ready to come to an agreement, “I am not ready to make a deal yet”.