Oil turns higher on trade talks hopes

Oil prices turned up as the US market opened today, after its earlier drop in the European market, to extending gains for the second straight day, on hopes about the US-China trade talks, while these gains are being curbed by the renewed concerns about the US oversupply after a massive surge in the US crude inventories and oil production for the fourth consecutive week.

WTI rose to $53.14 a barrel, from the opening of $52.63, with a session-low of $51.44.

Brent rose to $58.86 a barrel, from the opening of $58.27, with a low of $57.81.

Yesterday, WTI closed higher by 0.1% after it shed 0.5% in the previous day, and Brent futures also rose by 0.3%, on the sharp drop of OPEC output in September.

The Chinese Vice Premier Liu He will meet with the US trade representative Robert Lighthizer and US Treasury Secretary Steven Mnuchin in Washington later today to resume the trade talks between the world's two largest economies.

News reports quoted a Chinese government official saying on Wednesday that China is willing to talk about a possible partial deal with the US, but White House spokesperson told CNBC that President Trump has not make up his mind yet on the probability of a deal.

The US Energy Information Administration (EIA) revealed yesterday that oil inventories rose by about 2.9 million barrels during the week ending October 4th, the fourth weekly increase, beating forecasts of a 1.8 million barrels.

The total US commercial inventories rose to 426 million barrels, the highest level since the week ending in August 23rd, which shows that the domestic demand has worsened in the US, while production rose by 200,000 barrels, to reach an all-time record high of 12.6 million barrels per day.