Oil Prices Gain After US-EU Trade Deal Spurs Growth Optimism, China Talks In Focus

Oil prices rose in early trading on Monday, aided by optimism surrounding the trade deal between the U.S. and the European Union, amid hopes of an extension of the tariff truce between Beijing and Washington, D.C.

Benchmark Brent crude prices rose nearly 1% to $69.08 per barrel, while West Texas Intermediate crude prices gained 0.8% at $65.58 per barrel at 2.30 a.m. ET. Retail sentiment on Stocktwits about the United States Oil Fund (USO) was in the ‘neutral’ territory at the time of writing.

The EU agreed to a baseline tariff of 15% for its exports to the U.S., including automobiles. The 27-nation bloc also agreed to American energy products worth $750 billion and pledged to invest $600 billion in the U.S. The deal alleviated some concerns about a slowdown in economic growth, as the EU is Washington's largest trading partner.

Separately, U.S. and Chinese officials will meet in Stockholm to extend a tariff truce beyond the Aug. 12 deadline. Key topics of discussion include how long the tariff truce will last, U.S. levies linked to fentanyl trafficking, and China’s imports of sanctioned oil from Russia and Iran. Trump said on Sunday that his administration was “very close” to securing a trade deal with China.

However, the prospect of rising oil supplies was weighing on prices. The market monitoring panel for the Organization of the Petroleum Exporting Countries and its allies is scheduled to meet on Monday at 1200 GMT. A Reuters report said that while it is unlikely to recommend altering existing plans by eight members to raise oil output by 548,000 barrels per day in August, a change cannot be ruled out yet.

“The market has largely taken rising OPEC+ production in stride, but there may still be some point where one barrel too many does tip the market lower,” said energy market analyst Tim Evans in a note.

Also See: Thousands Of Dominion Energy Customers In Virginia Remain Without Power After Storms

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Share

·

Add us on