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Oil Extends Rally On Trade Talk Optimism

Oil prices rallied on Wednesday to extend gains for an eight straight session, its longest rally in 1 1/2 years, amid optimism over trade talks between the United States and China.

Brent for March settlement jumped 1.94 percent to $59.86 a barrel on the ICE Futures Europe Exchange in London, while West Texas Intermediate for February delivery climbed as much as 2.29 percent to $50.92 on the New York Mercantile Exchange.

As trade negotiations entered their third day, there is speculation that a trade deal can be struck ahead of a March 1 deadline established by Trump and Chinese President Xi Jinping last month at the G-20 summit in Argentina.

Meanwhile, UAE Energy Minister Suhail Al Mazroui said that a global oil pact to cut production by 1.2 million barrels per day (mbpd) is enough to balance the oil market.

Investors shrugged off a World Bank report suggesting that global growth will drop to 2.9 percent this year from 3 percent in 2018 on the back of several downside risks.

"The outlook for the global economy has darkened. Global financing conditions have tightened, industrial production has moderated, trade tensions have intensified, and some large emerging market and developing economies have experienced significant financial market stress," the bank said.

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