Oil climbed as signs the US and China may be ironing out their trade differences helped allay concern with large OPEC+ output increases. 

Brent futures extended gains after China's official news agency reported that Presidents Donald Trump and Xi Jinping spoke over the phone. Still, prices have been largely bound to a narrow price range near $65 a barrel since the middle of May. Gains were contained in equity markets as traders await US jobs data due on Friday.

Saudi Arabia wants the Organization of the Petroleum Exporting Countries and its allies to continue to add at least 411,000 barrels a day of output in August and potentially September, according to people familiar with the matter. Rising fuel consumption during the summer, however, could help make up for those extra barrels.

In the US, crude inventories fell by 4.3 million barrels last week, the most since November, data from the Energy Information Administration showed. The drawdown was bigger than an earlier estimate by an industry body. 

Crude has fallen about 13% this year on fears a US-led trade war will sap economic growth and energy demand. President Donald Trump has been calling for talks on tariffs with his Chinese counterpart Xi Jinping, who seems to be reluctant to go ahead with high-level negotiations at this stage. 

Meanwhile, Saudi Aramco cut the price of its main oil grade to buyers in Asia for loading next month, but by less than the reduction signaled in a Bloomberg survey. 

Source: Bloomberg