Oil prices claw back some ground, but demand worries drag

TOKYO (Reuters) – Oil on Friday clawed back some of its losses from the previous session when prices fell the most in a month, although worries that emerging market crises and trade disputes could dent demand continued to drag.

was up 23 cents, or 0.3 percent, at $78.41 a barrel by 0122 GMT, after falling 2 percent on Thursday. The global benchmark the day before rose to its highest since May 22 at $80.13 a barrel.

U.S. light crude was up 27 cents, or 0.4 percent, at 68.86, after dropping 2.5 percent on Thursday.

The International Energy Agency on Thursday warned that although the oil market was tightening at the moment and world oil demand would reach 100 million barrels per day (bpd) in the next three months, global economic risks were mounting.

“As we move into 2019, a possible risk to our forecast lies in some key emerging economies, partly due to currency depreciations versus the U.S. dollar, raising the cost of imported energy,” the agency said.

“In addition, there is a risk to growth from an escalation of trade disputes,” the Paris-based agency said.

China will not buckle to U.S. demands in any trade negotiations, the major state-run China Daily newspaper said in an editorial on Friday, after Chinese officials welcomed an invitation from Washington for a new round of talks.

U.S. President Trump said on Twitter on Thursday that the United States holds the upper hand in talks.

“We are under no pressure to make a deal with China, they are under pressure to make a deal with us,” Trump tweeted.

U.S. companies in China are being hurt by mounting trade tensions between Washington and Beijing, according to a survey, prompting U.S. business lobbies to urge the Trump administration to reconsider its approach.

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