(Bloomberg) -- Oil is on track for a weekly gain, buoyed by signs of a cooling in trade tensions between the U.S. and China and after official data showed a draw down in U.S. crude inventories.

Futures in New York were up 0.1%, after falling 0.6% on Thursday. The U.S. benchmark is up about 1% over the week. Investors are balancing fears about slowing global economies and demand with anticipation the Federal Reserve Chair Jerome Powell will signal a rate cut is coming during a speech Friday at a Wyoming conference. Meanwhile, U.S. President Donald Trump said Thursday he would “probably” make a deal with China on trade, after a move to delay sanctions against Huawei Technologies Co. earlier in the week offered a hint of progress.

U.S. crude inventories fell by a bigger-than-forecast 2.73 million barrels last week, according to government data, although a 2.61 million-barrel increase in stored supplies of diesel and other distillates, muddied the outlook for demand.

To contact the reporter on this story: James Thornhill in Sydney at jthornhill3@bloomberg.net

To contact the editors responsible for this story: Ramsey Al-Rikabi at ralrikabi@bloomberg.net, Keith Gosman

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