Oil prices rebounded on Thursday morning, recovering some of Wednesday’s losses after signs emerged of potential tariff and trade negotiations between the United States and China.
As of 9:28 a.m. EDT, U.S. West Texas Intermediate (WTI) Crude was up by 0.95%, trading at $62.86 per barrel. Meanwhile, the international benchmark, Brent Crude, rose 0.7%, reaching $66.58.
The market’s movement came after recent comments from Washington and Beijing hinted at the possibility of easing tensions in the ongoing trade war. Both sides suggested that tariff and trade talks between the world’s two largest economies could be on the horizon.
Oil prices had fallen by about $10 per barrel since President Donald Trump escalated the tariff dispute with China in early April. The drop was driven by concerns over the global economy, with many analysts fearing a potential U.S. recession. Following the imposition of hefty tariffs by the Trump administration, several investment banks raised the possibility of a recession becoming more likely.
On Wednesday, President Trump stated that tariffs on China “will come down substantially,” fueling optimism.
In response, China called for the cancellation of U.S. tariffs, but also emphasized that no official trade talks had started, despite reports from Washington indicating direct contact between the two nations.
The market was also supported by a report from the U.S. Energy Information Administration (EIA) on Wednesday, showing a significant drawdown in U.S. oil stocks.
However, the market remains uncertain, balancing signs of a potential de-escalation in trade tensions with concerns about rising oil production from OPEC+ nations. Kazakhstan, for example, stated that its oil production strategy would prioritize national interests, rather than adhering to OPEC+ production quotas.
“Growing disagreements within OPEC+ are keeping oil prices from fully participating in the broader market rally as trade tensions ease,” noted ING commodities strategists Warren Patterson and Ewa Manthey.
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