UPDATE 10-Oil steady; U.S.-China tensions weigh, possible output cuts support

* China to halt purchases of U.S. soybeans, pork -sources
* OPEC, Russia consider extension to oil curbs -sources
* Algeria proposes early OPEC+ meeting on June 4

(New throughout, updates prices, market activity and comments
to settlement)
By Stephanie Kelly
NEW YORK, June 1 (Reuters) - Oil futures steadied on Monday
as rising U.S.-China tensions weighed on sentiment, but prices
drew support from reports that OPEC and Russia were close to a
deal extending output cuts.
Brent futures LCOc1 rose 48 cents, or 1.3%, to settle at
$38.32 a barrel. U.S. crude CLc1 fell 5 cents, or 0.1%, to
settle at $35.44 a barrel.
Prices found support after news that the Organization of the
Petroleum Exporting Countries and Russia, known as OPEC+, were
moving closer to a compromise on extending oil output cuts and
were discussing rolling over the curbs one to two months.
Algeria, which holds the rotating OPEC presidency, has
proposed that OPEC+ hold a meeting on June 4 rather than the
previously planned June 9-10. Stockpiles at Cushing, Oklahoma, fell to 54.3 million
barrels in the week to May 29, traders said, citing a Genscape
report on Monday.
Bank of America said Monday it believed that North American
oil shut-ins peaked in May.
"Oil prices have strengthened to levels where shutting-in no
longer makes sense and should actually encourage producers to
quickly restore production," according to a BofA Global Research
report.
Investors have turned more cautious, however, after China
warned of retaliation on U.S. moves over Hong Kong. China has asked its state-owned firms to halt purchases of
soybeans and pork from the United States, two people familiar
with the matter said, after Washington said it would eliminate
special U.S. treatment for Hong Kong to punish
Beijing. "The possibility of heightened tensions does pose a risk for
the recent rally in oil prices," said Harry Tchilinguirian, head
of commodity research at BNP Paribas.
Economic concerns and questions about fuel demand recovery
also weighed on oil futures. Manufacturing data on Monday showed
that Asian and European factories were struggling as
government-imposed lockdowns tempered demand.