Oil prices rose by around 1 per cent on Friday, pushed up by Saudi plans for OPEC and Russian-led production curbs introduced in 2017 to be extended into 2019 to further tighten the market.
The rise in oil prices defied global stock markets, which slumped on the back of worries about a trade stand-off between the United States and China. Gold, seen as a safe haven in times of economic turmoil, rallied to a two-week high on Friday.
U.S. President Donald Trump signed a memorandum on Thursday that could impose tariffs on up to $60 billion of imports from China, while China unveiled plans on Friday to impose tariffs on up to $3 billion of U.S. imports.
U.S. West Texas Intermediate (WTI) crude futures were at $64.95 a barrel at 0753 GMT, up 65 cents, or 1 per cent, from their previous settlement.
Brent crude futures were at $69.51 per barrel, up 60 cents, or 0.9 per cent. For the week, Brent was set for a gain of about 5 per cent, its strongest showing since July last year, while WTI was up about 4.2 per cent.
The driver for crude futures was a statement by Saudi Arabian Energy Minister Khalid al-Falih, who said on Thursday that OPEC members will need to continue coordinating with Russia and other non-OPEC oil-producing countries on supply curbs in 2019 to reduce global oil inventories.
"Crude oil prices surged today as Saudi Arabia's energy minister seeks to extend output curbs into 2019," Singapore-based brokerage Phillip Futures said in a note.
The Organization of the Petroleum Exporting Countries (OPEC), of which Saudi Arabia is the de-facto leader, as well as a group of non-OPEC countries led by Russia, struck an agreement in January 2017 to remove 1.8 million barrels per day (bpd) from markets to end oversupply.
"We still have some time to go before we bring inventories down to the level we consider normal," Falih told Reuters in Washington. "We will hopefully by year-end identify the mechanism by which we will work in 2019."
Although analysts said the stand-off between the United States and China could hit oil markets, for now most said demand looked healthy.
Morgan Stanley also cited a pick-up in seasonal demand in the coming months and geopolitical risk as potential supports for oil prices.
"We are only 3-4 weeks away from peak refinery maintenance, after which crude and product demand should accelerate ... Global inventories are already at the bottom end of the five-year range. With the inventory cushion largely gone, oil prices will likely be more sensitive to geopolitical risk factors," the U.S. bank said.
"There are sufficient reasons to expect oil prices to strengthen further from here, and we stick with our (Brent) $75 per barrel call for Q3," Morgan Stanley said.