Oil prices climb in the US as hopes grow for stronger trade ties and steadier global markets. This increase follows the announcement of a new trade agreement between the United States and the European Union. Additionally, a possible extension of tariff relief between the US and China brings further optimism. These developments ease fears that prolonged trade disputes could damage the global economy and reduce fuel demand.
Brent crude edged up by 20 cents, reaching $68.64 per barrel. Meanwhile, US West Texas Intermediate rose by 15 cents to hit $65.31 per barrel. Analysts believe the renewed optimism in trade relations is driving the increase.
“The risk of an extended trade war is easing,” said a market analyst. “Markets have responded positively to these developments.”
The new US-EU deal imposes a 15% import tariff on most European goods. This rate is half of what had been threatened earlier. The agreement prevents a deeper trade conflict between two of the world’s largest trading partners. These partners together account for nearly one-third of all global trade.
At the same time, US and Chinese officials plan to meet in Stockholm. They aim to extend their current agreement that holds off new tariffs. This meeting could prevent higher tariffs from taking effect and keep the market stable.
Still, oil prices had dropped last Friday due to fears of more global supply and worries over trade. Venezuela’s state oil firm, PDVSA, is preparing to restart production at several joint ventures. These ventures will operate under terms similar to past US agreements, pending approval for oil exports under swap deals.
Though prices rose slightly, some market watchers expect OPEC+ to ease supply limits. The group of oil-producing countries is set to meet soon. Most experts believe they will stick to plans that allow eight members to boost production by 548,000 barrels per day.
OPEC+ also looks to restore 2.2 million barrels per day of earlier voluntary cuts by the end of September. That could mean an additional 280,000 barrels per day added in September. However, some analysts think there’s room for even bigger increases.
As summer continues, demand for fuel is rising. This oil prices climb in the US gives oil producers a chance to reclaim lost market share. JP Morgan analysts reported that global oil demand in July rose by 600,000 barrels per day from the previous year. In contrast, oil stockpiles also climbed by 1.6 million barrels per day.
In the Middle East, tensions remain. Yemen’s Houthis declared they would target ships tied to Israeli ports. They say this move is part of a new phase of operations over the Gaza conflict. Despite this, the main focus in oil markets remains on trade progress and supply movements.