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Brent crude oil futures rose slightly on Thursday, rebounding from the decline, after U.S. President Trump reignited investors'hope that the United States might not raise tariffs on Chinese imports to the United States. Tariff increases could hit economic growth and curb oil demand.
Trade disputes between the world's two largest economies and a sharp drop in global stock markets have hit oil prices more than the impact of geopolitical tensions and production cuts on supply cuts in Latin America, Africa and the Middle East.
Brent crude oil futures closed up $0.02 at $70.39 a barrel, rebounding from a daily low of $69.40. U.S. crude oil futures fell $0.42 to $61.70 a barrel.
Oil prices rebounded from mid-session lows after Trump said he had received a "beautiful letter" from Chinese President Xi Jinping. Trump quoted Xi Jinping's letter as saying, "Let's work together to see if we can do something."
Bob Yawger, head of Mizuho Energy Futures, said the letter boosted investors'hopes for a possible trade agreement between Washington and Beijing.
Trade disputes have dragged down economic growth in Asia, and the breakdown of Sino-US trade negotiations may cast doubt on global crude oil demand expectations, said John Kilduff, partner of Again Capital Management LLC.
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