U.S. oil prices settled at a new 2016 high on Tuesday as the dollar fell and traders bet that U.S. oil output would continue to fall. However, some analysts warn that persistent market oversupply could prevent further price gains. Light, sweet crude for June delivery rose $1.40, or 3.3%, to $44.04 a barrel on the New York Mercantile Exchange, the highest settlement since Nov. 10. Brent, the global benchmark, rose $1.26, or 2.8%, to $45.74 a barrel in ICE Futures Europe. Oil was propped up by the dollar, which fell ahead of a meeting of Federal Reserve officials on Tuesday and Wednesday. The Fed could drop hints after its meeting about future interest-rate increases and the strength of the U.S. economy.
Oil rose above $62 a barrel on Thursday after China hinted at progress toward a trade deal with the United States, raising hopes for an end to a long dispute that has weighed on economic growth and fuel demand.
Beijing’s comments boosted market sentiment, which had also been ruffled by Wednesday’s U.S. government supply report showing crude inventories rose last week by 7.9 million barrels, much more than expected by analysts.
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