2019.11.0709:17:00UTC+00Oil Rebounds On Trade Deal Optimism

Oil prices rose on Thursday as increasing hopes of a trade truce between the United States and China helped investors shrug off data showing a huge increase in U.S. crude stockpiles.

Benchmark Brent crude rallied 1.2 percent to $62.49 a barrel, after having fallen almost 2 percent on Wednesday.

West Texas Intermediate crude futures were also up 1.2 percent at $57.01 a barrel, after declining 1.55 percent in the previous session.

Hopes grew for a U.S.-China trade agreement after China and the United States reportedly agreed to cancel tariffs on each other's goods for both sides to reach a "phase one" trade deal.

The two sides have agreed in the past two weeks to cancel tariffs imposed during their months-long trade war in different phases, the Chinese commerce ministry said.

The proportion of tariffs cancelled must be the same, and how many tariffs should be cancelled can be negotiated, Gao Feng, spokesman at the commerce ministry, told reporters.

Adding to the optimism, data from the People's Bank of China showed today that China's foreign exchange reserves increased by $12.7 billion from the previous month to $3.105 trillion in October.

According to the data released by the Energy Information Administration on Wednesday, crude oil stockpiles in the U.S. increased by 7.9 million barrels in the week ended November 1, more than five times the expected increase as refiners cut output and exports fell.