WASHINGTON, United States – Oil prices rose significantly on Monday after US and Chinese officials announced they had reached a framework for a trade agreement. This helped ease concerns about the impact of reciprocal tariffs on global economic growth.
By 00:27 GMT, Brent crude futures rose 0.7% to $66.40 per barrel, while West Texas Intermediate crude futures rose 0.75% to $61.96 per barrel.
Last week’s gains
Oil prices made significant gains last week. Brent crude rose 8.9% and West Texas Intermediate crude rose 7.7%, driven by US and European sanctions on Russia. This increased concerns about supply shortages.
The positive impact of the trade agreement
Haitong Securities reported that the improved outlook for oil was due to easing tensions between the United States and China. This eased concerns about oversupply in the market, which had negatively impacted prices earlier in the month.
In remarks on Sunday, the US Treasury Secretary announced that senior economic officials from the United States and China had reached a “substantial framework” during talks in Kuala Lumpur. This paves the way for subsequent discussions between US President Donald Trump and Chinese President Xi Jinping.
The agreement aims to avoid 100% US tariffs on Chinese goods, as well as postpone controls on rare earth exports from China.
