Oil prices are climbing, buoyed by reports of significant progress in trade negotiations between the US and China aimed at easing long standing tariff and economic tensions.
International benchmark Brent crude increased by around 1.34%, trading at $64.61 per barrel at 9.48 am local time (0648 GMT), up from $63.75 at the previous session’s close.
The US Benchmark West Texas Intermediate rose by about 1.41%, reaching $61.57 per barrel, compared to its prior session close of $60.71.
China’s Vice Premier for Economic Affairs, He Lifeng, stated that ‘substantive progress’ was achieved during trade talks held in Switzerland with US Treasury Secretary Scott Bessent. He said both sides had agreed to establish a consultation mechanism for economic and commercial matters, a move he described as a major step towards resolving ongoing disputes through dialogue.
Emphasizing that China-US economic ties are built on mutual benefit, he reiterated Beijing’s readiness to work with Washington to overcome differences and deepen cooperation.
Bessent echoed the sentiment, describing the discussions with China as ‘productive’ and noting that meaningful progress had been made. US Trade Representative Jamieson Greer went further, calling the talks ‘very constructive.’
Analysts suggest that a thaw in tensions between the world’s two largest economies could ease pressure on global trade, supporting oil demand and in turn driving prices higher.
Meanwhile, market players are closely watching for the release of US inflation data due tomorrow. Last week, the US Federal Reserve (Fed) held interest rates steady, but flagged mounting uncertainty over the economic outlook in its policy statement, citing rising risks of both higher inflation and unemployment.
Economists say the upcoming inflation figures could offer clearer insight into the trajectory of the US economy.
A stronger than expected rise in inflation could prompt the Fed to pause planned interest rate cuts, a scenario that may weigh on oil prices in the near term.
By Humeyra Ayaz
