Crude oil futures were higher during mid-morning trade in Asia Tuesday, shrugging off bearish comments on the US-China trade negotiations as supply issues continued to dominate the spotlight.  At 10:30 am Singapore time (0230 GMT), July ICE Brent crude futures were at $70.11/b, unchanged from Monday’s settle, while the NYMEX July light sweet crude contract gained 55 cents/b (0.94%) from Friday’s settle to $59.18/b.  US President Donald Trump on Monday said that he was not rushing to reach a trade agreement with China, increasing uncertainty around the possibility of a trade deal being reached by the two countries any time soon.

“They (China) would like to make a deal. We’re not ready to make a deal,” said Trump during a joint press conference with Japanese Prime Minister Shinzo Abe on Monday.

“US President Trump said Monday that the country isn’t ready to make a deal with China. This occurred at the same time that Chinese industrial profits for April came in weak, suggesting the trade conflict is having an impact,” said ANZ analysts in a note Tuesday.  Industrial profits in China dropped 3.7% year on year to $103 billion dollars in April, according to media reports quoting data published by the National Bureau of Statistics of China on Monday.

However supply-side issues elsewhere continued to provide some price support, said analysts.  “Ongoing disruptions finally gained the attention of the market. In Libya, military leader, Khalifa Haftar, said that his offensive on Tripoli won’t stop until the country’s militia have been disarmed. This is likely to renew concerns about supply disruptions,” said ANZ analysts.

According to media reports, Libyan eastern commander, Field Marshal Khalifa Haftar, has ruled out a ceasefire in the battle for Tripoli and accused the UN of seeking to partition Libya.

“Though OPEC-led supply cuts remain supportive towards oil prices, we opine that strong bearish bias will persist for the current term. Markets will require a firm indication from OPEC+ (Jun 19) on supply-side policies to reverse negative bias for oil prices, ” said Benjamin Lu, investment analyst at Phillip Futures.

“Against the backdrop of a lack of reaction towards President Donald Trump’s words and the vacuum of leads, Asia markets look to trade to its own tune from a mixed but muted start to Tuesday,” said Pan Jingyi, IG market strategist.