Oil prices jumped about 2% on Monday, driven by a mix of geopolitical and trade news that caught the market’s attention.
A newly announced trade agreement between the US and the European Union helped boost sentiment, but what really moved the needle was President Trump’s statement calling for a shortened timeline to end the war in Ukraine, with the threat of tougher sanctions on Russia if progress stalls.
The combined effect lifted investor confidence and gave crude prices a noticeable push after a shaky few sessions.
Brent crude climbed between $1.36 and $1.63 a barrel on Monday, rising roughly 2% to 2.4% and briefly topping $70.07, its highest level in nearly ten days.
Prices held above the $69.80 mark for most of the session as momentum picked up.
US West Texas Intermediate (WTI) crude saw similar gains, up around 2% on the day, trading in the range of $66.49 to $66.78 per barrel.
What factors are driving Oil prices today?
The US-EU trade deal announced Sunday sets a 15% tariff on most EU imports, far below what had been threatened earlier.
It also commits the EU to buying around $750 billion in US energy over the coming years, a detail that helped ease concerns about demand risks and supply disruptions.
In a separate announcement, Donald Trump shortened Russia’s window to exit Ukraine from 50 days to just 10–12, raising the risk of new sanctions.
Russia’s role as a major crude exporter gave that news extra weight.
Hopes for an extension of the US-China tariff pause added to the upbeat tone, as trade tensions between the two countries have long been a drag on commodity markets.
What analysts said?
Analysts said the US-EU trade deal and signs of progress with China helped calm markets and provided a more stable backdrop for risk assets, including oil.
They noted that the trade deal gave a boost to broader financial sentiment and helped support crude, adding to underlying strength in the market.
Beyond the trade headlines, supply-side factors were also in focus.
OPEC+ is expected to stick with its existing production plans at its upcoming meeting, though voluntary cuts by some members continue to shape the supply picture.
In the US, crude inventories fell by 3.2 million barrels last week, according to recent data, a sizable drawdown that added further support to prices.
US-China hold talks
The developments in oil prices came as the United States and China resumed trade talks in Stockholm, with both sides looking to extend their current tariff truce by another 90 days.
The goal is to prevent a fresh round of trade tensions ahead of the August 12 deadline, a risk that could once again rattle global supply chains.
US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are leading the discussions, which center on lowering tariffs and easing export controls, including restrictions on US technology shipments.
A successful extension could lay the groundwork for a potential meeting between President Trump and President Xi Jinping later this year, signaling progress toward easing one of the most significant trade conflicts in recent memory.
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