(Bloomberg) -- Oil extended last week’s gain as a renewed round of US-China trade talks offered the potential for reduced global tensions.

West Texas Intermediate futures edged up to trade near $65 a barrel after earlier grazing the highest intraday price since early April. Negotiators from the US and China were holding talks in London on Monday, raising the possibility the two largest economies can make progress on disputes that have rattled markets this year.

“Crude is off overnight highs as mixed signals from China weigh on sentiment,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth Group. “Positioning data shows a sharp rise in WTI longs and significant short covering — implying we may need more than technical momentum to push prices meaningfully higher from here.”

Commodity trading advisers, which can accelerate price momentum, liquidated short positions to sit flat in WTI on Monday, compared with 64% short on June 5, according to data from Bridgeton Research Group. A 3% to 4% price move higher may trigger the funds to flip to net-long for the first time since February, the group added.

Crude has recovered after plunging earlier this year on the twin hit of bumper OPEC+ supply increases and concerns about the outlook for demand following President Donald Trump’s tariff policies. Now, though, the peak summer demand season is looming and markets are looking tighter.

The nearest US crude futures are trading close to $1 above the next month, which indicates tight short-term supplies.