Oil steadies as Saudi, Kuwait signals offset demand fears

Oil prices were little changed on Monday as expectations that major producers would continue to reduce global supplies ran into worries about sluggish growth in crude demand due to the U.S.-China trade war.

International benchmark Brent crude settled at $58.57 a barrel, up 4 cents. West Texas Intermediate (WTI) futures settled at $54.93, up 43 cents.

Investors were torn between forecasts of slowing global oil demand growth and chatter about renewed efforts by major producers to curtail output and support prices, analysts said.

The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

Kuwait was “fully committed” to the OPEC+ agreement, Oil Minister Khaled al-Fadhel said, adding that Kuwait has cut its own output by more than required by the accord.

He said fears of a global economic downturn were “exaggerated,” and said global demand for crude should pick up in the second half, helping reduce the surplus in oil inventories gradually.

Analysts said in a sign that de-facto OPEC leader Saudi Arabia intends to support prices, state-run Saudi Aramco is ready to launch what could be the world’s largest initial public offering.

The Saudi government will decide when the IPO will take place based on its perception of “what would be the optimum market condition,” senior Aramco executive Khalid al-Dabbagh said in an analyst call.

The official said Saudi Aramco has signed a letter of intent with India’s Reliance to potentially buy a stake in its refining and petrochemicals business