4-9-18 3:27 PM EDT | Email Article
By Alison Sider and Christopher Alessi 

Oil prices rose along with broader markets Monday as fears surrounding a trade war between the U.S. and China receded and oil investors turned their attention to rising tensions in the Middle East.

U.S. crude futures rose $1.36, or 2.19%, to $63.42 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, rose $1.54, or 2.29%, to $68.65 a barrel on ICE Futures Europe.

The move higher -- oil's biggest daily gain in more than two weeks -- is a pivot from last week, when the U.S. benchmark posted its biggest weekly loss in two months. Last week, oil prices followed equity markets lower as U.S. and Chinese officials lobbed threats of new tariffs, raising the prospect of a trade war between the world's two largest economies. Investors feared that would impede the global growth that was one of the main underpinnings of oil's climb in recent months.

But equity indexes moved higher Monday as policy makers dialed back some of their harsh rhetoric on trade. Trump administration officials said Sunday that penalties aren't imminent and that there is still time for the two countries to work out a deal.

"The equities are rebounding this morning, I think that's turning around crude," said Kyle Cooper, a consultant at ION Energy Group.

Oil traders shifted focus to the situation in Syria following an airstrike early Monday, said Andy Lipow, president of Lipow Oil Associates. Missiles hit an air base in Syria early Monday in a strike that Russia blamed on Israel. Over the weekend, a suspected chemical weapons attack in a rebel-held town near Damascus killed dozens of civilians and spurred calls for international action.

"The market is more concerned about the Mideast geopolitical tensions," Mr. Lipow said. "What's going on in Syria could lead to a wider conflict."

The increase in oil prices Monday comes despite fresh signs of rising oil production in the U.S. The number of rigs drilling for oil in the U.S. -- a proxy for activity in the sector -- was up by 11 last week, according to Baker Hughes.

Gasoline futures rose 2.95 cents, or 1.51%, to $1.9842 a gallon. Diesel futures rose 3.88 cents, or 1.98%, to $1.9966 a gallon.

Write to Alison Sider at alison.sider@wsj.com and Christopher Alessi at christopher.alessi@wsj.com

 

(END) Dow Jones Newswires

April 09, 2018 15:27 ET (19:27 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.
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