The Middle Kingdom's supremo, Chinese President Xi Jinpeng, sent equity markets on the up and up. Instead of talking tough and raising the ante on the brewing trade war with the US, Xi announced the opposite.
In his speech at the Boao Forum for Asia Annual Conference, the supremo talked about lowering (you read right, lowering) import tariffs, relaxing foreign investment regulations and strengthening intellectual property protection, among others.
All I can say is hail to the king! Xi must be taking Sun Tzu's (The Art of War) advice: "The supreme art of war is to subdue the enemy without fighting." This seemed to have worked with US President Trump tweeting that "We'll make great progress together!" and is "very thankful" of the Chinese president's statement.
So far so good. Then again, Sun Tzu's Art of War also prescribed that: "The whole secret lies in confusing the enemy, so that he cannot fathom our real intent." We believe oil prices will get higher in this year and also get higher in 2019, so we are trying to pick the right time [for the issuance of Aramco's IPO]". But I digress.
There's another war happening in another kingdom. The Kingdom of Saudi Arabia's ongoing battle to keep the price of oil heading north or to around US$80 per barrel received some press after in an interview with Time magazine, Saudi Crown Prince Mohammed bin Salman, said that: "We believe oil prices will get higher in this year and also get higher in 2019, so we are trying to pick the right time [before the issuance of Aramco's IPO]".
This, along with Saudi Energy Minister Khalid al-Falih's statement that OPEC would rather have a tighter oil market than end the supply cuts prematurely extended the increase in oil prices.
The price of crude oil has continued to climb this year to date - WTI oil has risen by 8.3% so far this year (following a 12.5% increase in 2017) and Brent oil's up 6.4% (after jumping by 21.4% last year).
That the Kingdom of Saud wants a higher price for its main export is hardly surprising. Never mind getting a good price for Aramco's IPO, it has to fix its budget balance which had been in deficit since 2014 as the price of oil collapsed.
Certainly, the production cuts that started on the 1st of January 2017 and was supposed to last for six months to June 2017 but then extended by nine months to March 2018 and then to end 2018 have kept the price of oil buoyant but perhaps not enough to OPEC's liking.
Now that the Saudis have hinted at a target price, it's highly likely that oil prices will be heading towards US$80 a barrel.
But how long can prices stay at this level, particularly if early indications of the weakening pace of the synchronised global upswing become a trend?
Not to mention, the question of increasing supply from US shale producers that's positively correlated with higher oil prices.
As at April 6, the Baker and Hughes rotary oil rig count has reached 808 rigs - its highest level 37 months - up 8.2% so far this year after surging by 42.3% in 2017.
Ben Ong is the Director of Economics and Investments at Rainmaker Group. He previously worked as a fund manager, economist, asset allocation strategist, portfolio analyst and stock market analyst. Check out his economics analysis here.