One tenet of the U.S. - China Trade Agreement reached in substance yesterday requires China to buy crude oil from the U.S. When the 80-page agreement is finally signed and a copy of it is released to the public in its final form, we will see the volumes of oil China is promising to buy from us. This entices China to stop buying oil illegally from Iran, and provides a new (a hefty) market for our crude. This, no doubt, is a big part of the reason why oil is touching $60/bbl on NYMEX again.
I personally expect it to rise higher, especially in January after the final agreement is formally signed, and we get to see the volume of oil China is promising to buy from us each year. Based on all of this, it is reasonable to project oil prices will rise above $70 but probably level out around $75.
Oil companies with cash and savvy will take advantage of this unfolding event, to position themselves to be producers of oil to be earmarked for China. Lease offers should pick up over the weeks following signing the Phase 1 trade agreement.