LONDON: Oil prices edged higher on Friday but were little changed on the week as sluggish economic growth in China, the world’s biggest crude importer, raised concerns over fuel demand and countered optimism from the signing of a China-US trade deal.

The world’s second-largest economy grew by 6.1 per cent in 2019, its slowest expansion in 29 years, government data showed on Friday.

Brent crude futures were up 29 cents at $64.91 a barrel by 1308 GMT. US West Texas Intermediate futures were up 29 cents at $58.81.

Oil rose on Thursday after China and the United States signed their Phase 1 trade accord.

The mood was further boosted with the US Senate’s approval of changes to the US-Mexico-Canada Free Trade Agreement.

In 2019 Chinese refineries processed 651.98 million tonnes of crude oil, equal to a record high 13.04mbpd and up 7.6pc from 2018, government data showed.

“The increase in China’s refinery capacity is reshaping the trade flows of refined products, while the increase in US crude oil production is reshaping the trade flows of crude oil,” said Olivier Jakob of consultancy Petromatrix.

Forecasts by two major agencies of a supply surplus this year also weighed on prices. The International Energy Agency on Thursday offered a bearish view of the oil market outlook for 2020. Opec supply will exceed demand for its crude, the IEA forecast, even if Opec member states comply fully with output cuts agreed with Russia and other producers in a grouping known as Opec+.

Published in Dawn, January 18th, 2020