Oil rises 1.5% after robust European data

Oil prices rose 1.5% as the US market market opened on Friday, to resume gains after yesterday's breather, thanks to strong economic data in Europe that lifted hopes for the global demand recovery from the coronavirus impact, but oil's gains are being curbed by the ongoing geopolitical tensions between the US and China.

The US crude rose 1.5% to $41.65, after opening at $41.04, and hit a session-low at $40.74, and Brent crude rose 1.4% to $43.88, after opening at $43.28, with a low of $43.03 .

The US crude lost 2.1%, and Brent crude futures fell 2.2% yesterday, to post their first loss in 4 days, due to US oversupply concerns.

Data showed today that the manufacturing sector in most parts of Europe grew in July at the best pace in two years, especially in the largest European economy, Germany.

These data show that the Eurozone economy is recovering at a faster rate than expected pace from the coronavirus damages, after the EU launched a historic economic recovery fund, and successful containment of the coronavirus outbreak by most of the European countries.

The data also raised hopes for a global demand recovery, which is already returning to pre-pandemic levels.

The global oil demand crashed 30 million bpd or 30% of the pre-pandemic levels in March, due to the "Great Lockdown" of the global economy. 

Otherwise, the Chinese government announced today that it has revoked the license of the US Consulate General in the southwestern city of Chengdu, and ordered the consulate to close.

This came after the US ordered China to close its consulate in Houston, claiming its a spying center and used for US intellectual property theft.

The escalation of tensions between Washington and Beijing foreshadows a deterioration in trade relations between two countries, which have improved after signing the Phase-One trade deal in January.