Oil Stabilizes, Supported By Bullish US Inventory Data
NEW YORK, Aug 23 (Reuters) - Oil prices steadied on Thursday, supported by a bullish U.S. inventory report from the previous session even as an escalating trade dispute between the United States and China weighed on demand expectations.
Brent crude oil was up 2 cents a barrel at $74.80 by 11:13 a.m. EDT [1513 GMT]. U.S. light crude was 2 cents lower at $67.84 a barrel.
"The market is trying to balance the worries about decreased global demand growth and how much extra oil the Saudis and Russians are going to put on," said Gene McGillian, director of market research at Tradition Energy in Stamford, Connecticut.
At the same time, he said, the market was getting support from strong demand growth showed in Wednesday's weekly inventory report from the Energy Information Administration (EIA).
"There's a better fundamental picture than a year ago," he said.
The trade dispute between the United States and China deepened on Thursday with the imposition of 25 percent tariffs on $16 billion worth of each other's goods.
The world's two largest economies have now imposed tariffs on a combined $100 billion of products since early July, with more in the pipeline, adding to risks to global economic growth.
Washington is holding hearings this week on a proposed list of another $200 billion worth of Chinese imports to face duties, to which China is almost certain to respond.
"These (overall) measures are expected to shave up to 0.3-0.5 percentage points from China's real GDP growth in 2019," said rating agency Moody's Investor Service. "For the U.S. ... trade restrictions will trim off about one quarter of a percentage point from real GDP growth to 2.3 percent in 2019."
Oil demand is closely linked to economic activity and the trade dispute has already led analysts to trim their forecasts for future energy consumption.
But while the outlook for oil demand growth may be moderating, some markets are tight.
U.S. commercial crude oil inventories
"This week's report was bullish for crude," said Societe Generale oil analyst Michael Wittner. "Crude stocks drew due to sharply lower crude imports and near-record refinery crude runs."
Meanwhile, U.S. oil production
That means the world's three top producers, Russia, the United States and Saudi Arabia, now all pump around 11 million bpd, meeting a third of global demand.
(Additional Reporting by Christopher Johnson in LONDON and Henning Gloystein in SINGAPORE Editing by Marguerita Choy and David Goodman)
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