Oil has bounced back to a nine-week high as China has signaled a renewed desire to settle the trade war with the US that has disrupted global demand for energy.
Futures rose 2.8 percent in New York trading late Thursday as Chinese Vice Premier Liu He invited US President Donald Trump's top economic adviser to discuss the long-running misunderstanding.
In a Beijing address, Liu also disclosed local economic transformations which, according to people who attended the event and asked not to be identified, focus on some of Trump's key demands.
Bullish sentiment was also fueled by the increase of crude over the 200-day moving average by chart watchers, according to Toronto-Dominion Bank's head commodity strategist, Bart Melek.
After hitting a 2019 peak at the end of April, oil has fallen by about 12 percent in the face of substantial worldwide commodity stocks and risks to global demand for petroleum-based fuels.
A potential fracking ban on federal lands has become a hot topic among Democratic presidential candidates in the United States, spurring concern that some shale output might be imperiled.
West Texas Intermediate rose to $1.57 for January delivery to settle on the New York Mercantile Exchange at $58.58 a barrel, the best close since Sept. 23.
Brent for January's settlement on the London-based ICE Futures Europe Exchange rose $1.57 to close at $63.97. The crude global benchmark traded to WTI at a premium of $5.39.
In contrast, the EIA statement from the federal government showed that crude inventories rose by 1.4 million barrels relative to the rise of 1.6 million barrels predicted by energy experts.
High U.S. shale production, which held steady at a massive 12.8 million barrels per day, has largely driven surplus building with the world's largest user of oil. However, as refineries ramped up output, the drawdown was capped below projections.
This puts the total domestic stocks at 450.4 million barrels, or 0.8 percent above the year-ago figure and 3 percent above the five-year average.
At the Cushing terminal in Oklahoma, the oil market also drew some support from stockpiles. The primary distribution point of U.S. oil futures trading on the Mercantile Exchange in New York saw inventory fall to 44.2 million barrels by 2.3 million barrels.
Meanwhile, the prospect of a trade deal came just hours after the U.S. government said crude stockpiles declined the most in three months. Diesel inventories, on the other hand, have dipped, based on a study by the Energy Information Administration.
