Feb. 22 (UPI) -- Crude oil futures traded higher Friday amid renewed optimism that the United States and China could make progress in trade talks, analysts said.
West Texas Intermediate crude futures traded 1.2 percent higher at $57.66 per barrel as of 8:48 a.m. EST while Brent futures traded 0.7 percent higher at $67.63 per barrel as of the same time.
"All eyes will be on the talks going on with China with regards to tariffs. If we get positive rhetoric, which we feel will happen, we could see crude trade higher. However all risk assets across all classes we reel are rather stretched with Europe, China and even the U.S. showing a slowdown," Tariq Zahir, managing member of investor advisory firm Tyche Capital Advisors, told UPI
"Regarding yesterday's EIA numbers, we saw a build in crude and a very large build. Cushing and U.S. production hit an all-time high which we feel is going to go higher in the weeks to come as new pipelines are coming online in the Permian basin," Zahir added.
"But all movements will take the lead from the talks with China," he said.
WTI futures fell to $56.96 per barrel Thursday from $57.16 per barrel in the previous session interrupting a seven-day rally. Brent has also seen a rally, with an interruption in one session this week, that started around February 11 when prices were $61.51 per barrel.
Amir Hekmati, oil futures spec trader at TradeFlow, separately told UPI that in addition to optimism about China there are supply reduction issues contributing to the increase.
"Oil markets are buoyant on the expected impact of Saudi output cuts, sanctions on OPEC nations Iran, and Venezuela, and optimism in China trade talks," he said.
"After the recent Fed Minutes, the U.S. dollar has sold off, lifting crude oil on news the Fed plans to hold off on rate hikes, and balance sheet reduction," he said.
Hekmati said that, however, "economic data continues to disappoint, and U.S. oil production continues to surge higher."
Crude future prices are down from highs in 2018 of over $86 per barrel of Brent and $76 per barrel of WTI, both on October 3.