Oil rises in price after the US-EU trade deal
28 July 2025 12:06
Oil prices rose on Monday after the US signed a trade deal with the EU and may extend the pause in tariffs with China. The news eased concerns about the possible negative impact of higher tariffs on economic activity and fuel demand, "Komersant Ukrainian" reports citing Reuters.
According to OilPrice.com, futures for Brent crude oil rose 39 cents, or 0.57%, to $68.83 per barrel as of 11:53 a.m. Kyiv time. US West Texas Intermediate was trading at $65.52 per barrel, up 36 cents, or 0.55%.
Trade deals keep prices up
“The US-EU trade deal and the possible extension of the pause in US-China tariffs are supporting global financial markets and oil prices. The markets reacted positively due to the gradual reduction of the risk of a protracted trade war and the importance of the August tariff deadlines,”
– said Tony Sycamore, analyst at IG Markets.
Sunday’s US-EU framework trade agreement sets the US import duty at 15% on most European goods, half the previously announced rate. The agreement averted a larger trade war between the two allies, which together account for almost a third of global trade and could have limited fuel demand.
Senior U.S. and Chinese negotiators are also scheduled to meet in Stockholm today to extend the truce that prevents a sharp increase in tariffs until August 12.
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Venezuela is rushing to the market
On Friday, oil prices closed at their lowest level in three weeks under pressure from global trade concerns and expectations of increased oil supplies from Venezuela.
Venezuelan state-owned oil company PDVSA is preparing to resume the operation of its joint ventures under conditions similar to the Biden-era licenses after US President Donald Trump restores permits for its partners to operate and export oil under swap agreements, sources in the company said.
OPEC increases production
Despite a slight rise in prices on Monday, it was limited due to the prospect of further easing of supply restrictions by OPEC. The organization’s market monitoring panel is due to meet today at 15:00 Kyiv time.
It is unlikely that it will recommend changing the existing plans of the eight member countries to increase oil production by 548,000 barrels per day in August. This was stated by four OPEC delegates last week, although another source noted that it was too early to draw conclusions.
ING expects OPEC to at least complete the full return of 2.2 million barrels per day of additional voluntary supply cuts by the end of September. This would mean an increase in supply in September of at least 280,000 barrels per day. However, there is room for a more aggressive increase as the group of producers seeks to regain market share while summer demand helps absorb the additional barrels.
JP Morgan analysts reported that global oil demand rose by 600,000 barrels per day in July on an annualized basis, while global oil inventories increased by 1.6 million barrels per day.
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