2023.05.2909:17:00UTC+00Oil Prices Rise As US Debt Default Worries Ebb

Oil prices eked out modest gains on Monday after U.S. President Joe Biden and House Speaker Kevin McCarthy, R-Calif., reached an agreement in principle to raise the debt ceiling and avoid a potentially disastrous default by the U.S. government.

Overall gains, however, remained capped by doubts about China's economic recovery and mixed messages from OPEC+ on production cuts.

Benchmark Brent crude futures rose 0.3 percent to $77.19 a barrel, while WTI crude futures were up 0.4 percent at $72.94.

The last-minute will raise the debt ceiling for two years and keep non-defense spending roughly flat for fiscal 2024 and increase it by 1 percent in fiscal year.

McCarthy told reporters Saturday evening that he expects the GOP-controlled House to vote on the agreement on Wednesday.

Meanwhile, China growth concerns resurfaced after data showed profits at industrial profits in China fell 20.6 percent in the January-to-April period from the same period the previous year.

Traders now look ahead to upcoming OPEC+ meeting for directional cues amid tensions between Russia and Saudi Arabia over output targets.

Russia prefers its partners of the OPEC+ group to leave oil production unchanged when it meets next week.