Oil futures received support from a broader financial market rally, which saw Asian shares hit four-month highs on Friday on hopes the United States and China could strike a trade deal. President Donald Trump said on Thursday he will meet with Chinese President Xi soon to try to seal a comprehensive trade deal as Trump and his top trade negotiator both cited substantial progress in two days of high-level talks. prices were weighed down by a survey on Friday that showed China’s factory activity shrank by the most in almost three years in January amid slumping orders, reinforcing fears a slowdown in the world’s second-largest economy is deepening. these concerns, traders said oil markets overall are being supported by supply cuts from the Organization of the Petroleum Exporting Countries (OPEC), which according to a Reuters poll pumped 30.98 million barrels per day in January, down 890,000 from December. Venezuela, meanwhile, U.S. sanctions imposed on state oil firm this week are keeping tankers stuck at ports and are expected to accelerate the supply drop in February. latest U.S. sanctions could directly halt around 500,000 barrels per day of Venezuelan exports to the U.S.,”bank said.
Much Venezuelan crude oil is rated as heavy and requires the light petroleum naphtha, much of it supplied from the United States, for dilution before export to refineries.