The Stage Is Set For Oil Price Volatility On November 18th

With China’s Fourth Plenum meeting of its ruling Communist Party having ended in October and the U.S. 2020 presidential election campaign gathering pace, both sides have their reasons to unveil some sort of progress in the long-running trade war between them. Such an announcement had been expected around the time of the Asia-Pacific Economic Cooperation meetings scheduled for 16-17 of November but when Chile cancelled the event the timing has become more fluid. The recent tentative statements that U.S. and China will roll back tariffs on each other’s goods incrementally as they continue to negotiate a broader trade deal were sufficient to push crude oil futures lower for a short while. However, the reality is that any announced trade deal between the two sides in the current political environment will be short-lived, fractious, and volatile for all asset classes, including oil . For China, the next date that will be of key concern is the 18 th of November, the point at which the licensing that permits China’s Huawei Technologies to buy components from U.S. companies to supply existing customers is set to expire. This follows the U.S. government’s blacklisting of Huawei in May on the allegations that the Chinese technology giant is involved in activities contrary to U.S. national security or foreign policy interests. At the same time, the U.S. added another 46 Huawei affiliates to the ‘Entity List’ (to a total of more than 100 Huawei entities) that comprises companies effectively banned from doing businesses with U.S. […]

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