UPDATE 8-Oil settles higher on Chinese factory data, U.S. stimulus hopes

* China's factory deflation slows in July
* U.S. economic stimulus talks turn positive
* Iraq to deepen supply cuts in Aug, Sept

(New throughout, updates prices, market activity and comments
to settlement)
By Laura Sanicola
NEW YORK, Aug 10 (Reuters) - Oil settled higher on Monday,
supported by data suggesting Chinese factories were returning to
pre-pandemic levels, signs of rising energy demand and hopes for
an agreement in the United States on more coronavirus-related
economic stimulus.
Brent crude LCOc1 settled up 59 cents, or 1.3%, to $44.99
a barrel. West Texas Intermediate U.S. crude CLc1 was up 72
cents, or 1.8%, to $41.94 a barrel.
Prices also found support after U.S. President Donald Trump
tweeted that top congressional Democrats wanted to meet with him
on coronavirus-related economic relief.
The talks between Democrats and the Trump administration
broke down last week. "The oil complex is heavily reliant on that aid. We need
people to be able to boost economic activity to spur demand,"
said John Kilduff, partner at Again Capital in New York.
On Sunday, Saudi Arabian Aramco 2222.SE CEO Amin Nasser he
sees oil demand rebounding in Asia as economies gradually open
up.
China's factory deflation eased in July, driven by a rise in
global oil prices and as industrial activity climbed toward
pre-pandemic levels. "A smidgen of favorable headlines on the coronavirus front
has been enough to spur buying interest back into the gasoline
market," said Jim Ritterbusch of Ritterbusch and Associates.
Iraq said on Friday it would cut its oil output by a further
400,000 barrels per day in August and September to compensate
for its overproduction in the past three months.
The move would help it comply with its share of cuts by the
Organization of the Petroleum Exporting Countries and allies,
known as OPEC+. "This would send out a strong signal to the oil market on
various levels. That said, this would also require the
international companies operating in Iraq to join in with the
cuts," Commerzbank analyst Eugen Weinberg said.