Crude oil prices rose yesterday, in response to reports that the United States and China are inching closer to a deal on a tariff row that has slowed global economic growth.

Recall that President Muhammadu Buhari had November last year, presented an N8.8 trillion budget proposal for the 2019 fiscal year, which was benchmarked on $60 per barrel.

The output cuts deal by the Organisation of Petroleum Exporting Countries OPEC to remove excess inventory in the global oil market has also supported oil prices as supply from the producer-group fell to a four-year low in February.

Brent crude futures were up 1.07 cents at $66.14 per barrel as at the last trading, the US West Texas Intermediate (WTI) crude futures were up 55 cents at $56.35 per barrel.

Reuters reports that the United States and China appear close to a deal that would roll back US tariffs on at least $200 billion worth of Chinese goods, as Beijing makes pledges on structural economic changes and eliminates retaliatory tariffs on US goods, a source briefed on the negotiations said on Sunday in Washington.

Hopes of an end to the trade spat between the two world’s biggest economies added support to the oil market that has been rallying for the past two months on cuts to production.

Supply from OPEC fell to a four-year low in February, a Reuters survey found, as top exporter Saudi Arabia and its allies over-delivered on the group’s supply pact while Venezuelan output registered a further involuntary decline.

In the US, there are signs that the oil production boom of the past years, which has seen crude output rise by more than two million bpd since early 2018 to more than 12 million bpd, may slow down.

US energy firms last week cut the number of oil rigs looking for new reserves to the lowest in almost nine months as some producers follow through on plans to cut spending despite an increase of more than 20 percent in crude futures so far this year.

The President, had while addressing a joint session of the National Assembly Tuesday in Abuja, predicated the 2019 budget on $60 per barrel of oil benchmark at 2.3m litres per day, exchange rate of N305 to $1, a Gross Domestic Product GDP growth rate of 3.01 per cent and inflation rate of 9.98 per cent.

As part of efforts to achieve these projections, the Federal Government directed the Nigerian National Petroleum NNPC to take all measures to achieve the targeted 2.3 million barrels per day oil output per day.