Oil prices rose on Monday after the U.S. reached a trade deal with the European Union (EU) and may extend a tariff pause with China, reducing concerns that potentially higher levies would limit economic activity and impact fuel demand.
Brent crude futures inched up 22 cents, or 0.32 per cent to 68.66 dollars a barrel by 0035 GMT while U.S. West Texas Intermediate crude was at 65.38 dollars a barrel, up 22 cents, or 0.34 per cent.
The U.S.-European Union trade deal and a possible extension in U.S.-China tariff pause are supporting global financial markets and oil prices, IG markets analyst Tony Sycamore said.
The United States and the European Union struck a framework trade agreement on Sunday that will impose a 15 per cent import tariff on most EU goods, half the threatened rate.
The deal averted a bigger trade war between two allies that account for almost one-third of global trade and could crimp fuel demand.
Also, senior U.S. and Chinese negotiators will meet in Stockholm on Monday aiming to extend a truce keeping sharply higher tariffs at bay ahead of the Aug. 12 deadline.
Oil prices settled on Friday at their lowest in three weeks as global trade concerns and expectations of more oil supply from Venezuela weighed.
Venezuela’s state-run oil company PDVSA is getting ready to resume work at its joint ventures under terms similar to Biden-era licenses, once U.S. President Donald Trump reinstates authorisations for its partners to operate and export oil under swaps, company sources said.
