WTI climbs above $66.00 as trade talk optimism outweighs concerns over oil oversupply

• WTI price appreciates as trade talk optimism bolsters the outlook for the Oil demand.
• The US and EU are reportedly close to finalizing a deal that would impose 15% tariffs on EU goods.
• The US may allow Venezuela's state-run PDVSA to resume operations in the sanctioned OPEC nation and swap Oil.

West Texas Intermediate (WTI) Oil price extends its gains for the second successive session, trading around $66.30 per barrel during the Asian hours on Friday. Crude Oil prices receive support on optimism surrounding trade talks, which bolstered the outlook for the global economy and Oil demand.

Traders keep their eyes on progress in tariff negotiations, with the United States (US) and European Union (EU) reportedly nearing an agreement that would impose 15% tariffs on EU goods imported into the US. Moreover, US President Donald Trump announced earlier this week a major tariff deal with Japan, which includes a 15% tariff on Japanese exports.

However, the recent US Initial Jobless Claims data supports the odds of the Federal Reserve (Fed) keeping interest rates unchanged at next week's meeting. Markets are now pricing in fewer than two rate cuts for the year, with the first fully expected in October. The jobless claims fell to 217,000 in the previous week, down from 227,000 and 221,000 in the prior weeks. The higher borrowing cost negatively impacts the economic activities in the United States, the world's largest consumer, and Oil consumption.

Additionally, Oil price may come under pressure as the US is reportedly preparing to issue new authorizations to key partners of Venezuela's state-run PDVSA, starting with Chevron, allowing them to operate in the sanctioned OPEC nation and swap Oil, according to five sources cited by Reuters on Thursday.