SINGAPORE: Oil prices climbed on Tuesday as market sentiment improved following a US-EU trade agreement and discussions to extend the US-China tariff truce.
Brent crude futures rose 24 cents, or 0.34%, to $70.28 a barrel, while US West Texas Intermediate crude increased 22 cents, or 0.33%, to $66.93.
Both benchmarks had surged over 2% in the previous session, with Brent hitting its highest level since July 18.
The US-EU trade deal, which imposes a 15% tariff on most EU goods, avoided a full-scale trade war that could have disrupted nearly a third of global trade and weakened fuel demand forecasts.
Further supporting prices were reports of potential progress in US-China trade talks. Senior economic officials from both nations met for over five hours in Stockholm on Monday, with discussions set to continue on Tuesday.
Meanwhile, geopolitical tensions added to market volatility.
US President Donald Trump issued a new 10 to 12-day deadline for Russia to show progress in ending the Ukraine war or face sanctions.
Trump warned of penalties on Russia and buyers of its oil exports if no progress is made.
“Trump’s comments reignited fears that Russia’s oil flows would be impacted,“ said ANZ senior commodity strategist Daniel Hynes.
He noted that the EU’s latest sanctions, including a lower price cap on Russian crude and restrictions on refined products, also contributed to supply concerns. - Reuters
