Oil prices hold near two-week highs on trade war reprieve, weaker dollar
Brent crude futures inched down 10 cents, or 0.15 per cent, by 0008 GMT to US$66.53 a barrel. US West Texas Intermediate (WTI) crude slipped 7 cents, or 0.11 per cent, to US$63.60. Both benchmarks climbed more than 2.5 per cent in the previous session.
The dollar index, which measures the greenback against a basket of currencies, fell 0.67 per cent on Tuesday after data showed US inflation was lower than expected. A weaker dollar makes oil less expensive for holders of other currencies, increasing demand.
The two largest economies on Monday agreed to pause their trade war for at least 90 days, with the US cutting tariffs to 30 per cent from 145 per cent and China slashing duties on US imports to 10 per cent from 125 per cent.
Prices had climbed more than $1.60 a barrel on Tuesday following the agreement, settling up nearly 3 per cent.
Rystad energy analysts said in a note that the agreement had "eroded some demand side pessimism," though cautioning that there could be lingering impact from the tariffs despite the rollbacks.
The market was supported by reported declines in US gasoline and distillate inventories, a sign of resilient fuel demand.
Gasoline inventories fell by 1.4 million barrels and distillate stocks fell by 3.7 million barrels, market sources said on condition of anonymity, citing American Petroleum Institute figures on Tuesday. However, crude stocks rose by 4.3 million barrels.
Analysts polled by Reuters expected gasoline stocks to fall by 600,000 barrels, distillate inventories to rise by about 100,000 barrels and crude stocks to fall by 1.1 million barrels.
Official weekly inventory data from the US Energy Information Administration is due on Wednesday at 10:30 a.m. EDT (1430 GMT).
The market is watching US President Donald Trump's trip to the Gulf. He kicked off the visit Tuesday with an appearance at an investment forum in Riyadh, where he announced that the US would lift longstanding sanctions on Syria and secured a US$600 billion pledge from Saudi to invest in the US
Rystad Energy's global head of commodity markets Mukesh Sahdev said that preventing oil price spikes over the summer travel season will be a key part of the president's agenda on the trip, adding that the US could take advantage of lower prices to buy more Middle East crude for its Strategic Petroleum Reserve.
"The big unknown for the market is how US actions related to Iran, Russia and Venezuela will result in supply disruptions or additions," Sahdev said.
The US on Tuesday imposed fresh sanctions on some 20 companies it said were helping Iran's Armed Forces General Staff and its front company, Sepehr Energy, send Iranian oil to China.
The sanctions come following a fourth round of US-Iran talks in Oman aimed at addressing disputes over Iran's nuclear programme.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
2 hours ago
- The Star
Italy's Meloni says it's a 'positive' trade deal was reached but needs to see details
FILE PHOTO: Italian Prime Minister Giorgia Meloni speaks to the media with Austrian Chancellor Christian Stocker (not pictured) at Chigi Palace in Rome, Italy, July 15, 2025. REUTERS/Yara Nardi/File Photo ROME (Reuters) -Italy's Prime Minister Giorgia Meloni said on Sunday it is "positive" a trade deal has been reached between the European Union and the United States, adding, however, that she needs to see the details. Washington struck a framework trade deal with the EU imposing a 15% import tariff on most EU goods. "I consider it positive that there is an agreement, but if I don't see the details I am not able to judge it in the best way," Meloni told journalists on the sidelines of a meeting in Addis Ababa. Italy is one of the biggest European exporters to the U.S., with a trade surplus of more than 40 billion euros. The Italian government, led by a nationalist coalition, had urged its European partners to avoid a direct clash between the two sides of the Atlantic. In a statement, Meloni said that the agreement "ensures stability", adding that the 15% "is sustainable, especially if this percentage is not added to previous duties, as was originally planned." "We are ready to activate support measures at the national level, but we ask that they also be activated at the European level for sectors that will be particularly affected by US tariff measures," she added. The statement was also signed by the leaders of the other two coalition parties: Antonio Tajani of Forza Italia and Matteo Salvini of the League. (Reporting by Sara Rossi and Giselda Vagnoni, editing by Diane Craft and Nick Zieminski)
The Star
3 hours ago
- The Star
1st LD: U.S., EU reach trade deal: Trump, EU chief
LONDON, July 27 (Xinhua) -- U.S. President Donald Trump and European Commission President Ursula von der Leyen claimed Sunday that they had reached a trade deal under which the United States would impose a baseline tariff of 15 percent on European Union (EU) goods. The announcement was made at a joint press briefing Sunday afternoon following trade talks at the Trump Turnberry in South Ayrshire, Scotland. Pharmaceuticals were excluded from the agreement, while existing 50 percent tariffs on EU steel and aluminium exports to the United States will remain in place. Although both leaders described the deal as a step toward restoring "trade balance" and promoting more equitable two-way commerce, the agreement allows the United States to impose a broad 15 percent tariff on EU goods while securing zero-tariff access for a range of strategic American exports. In contrast, the EU has pledged to purchase 750 billion U.S. dollars' worth of American energy and commit an additional 600 billion U.S. dollars in investments in the United States. At the press briefing, Trump claimed the agreement would enable American cars to re-enter the European market and make U.S. agricultural exports more accessible in the EU.
The Star
7 hours ago
- The Star
Romanian deputy PM resigns after bribery case resurfaces
BUCHAREST (Reuters) - Romanian deputy prime minister Dragos Anastasiu resigned on Sunday after an old corruption scandal in which he was involved as a witness resurfaced at a time when the one-month-old coalition government is trying to enforce cost-cutting reforms. Anastasiu had been tasked by Prime Minister Ilie Bolojan with overseeing the reform of state-owned companies, part of broader efforts to reduce the largest budget deficit in the European Union and root out waste and inefficiency. Last week, an old corruption case revealed that one of Anastasiu's firms had been blackmailed by a tax authority inspector into paying bribes disguised as consultancy fees for eight years from 2009 or risk lengthy inspections. The company later denounced the inspector, who was convicted in 2023. Anastasiu and his business partner were never charged with a crime. Anastasiu said his company had paid all its taxes and the bribes were "for survival, not profit". "I encourage every entrepreneur to speak out and say under what conditions business has been done in Romania and no longer accept what we did while making mistakes," he told reporters on Sunday. The government, which will hike several taxes from August and is laying off staff and cutting bonuses, has already faced several street protests but has narrowly avoided a ratings downgrade from the lowest rung of investment grade. The European Union and NATO state has been rocked by political instability in the wake of a presidential election, which was cancelled in December and re-run in May, with market turmoil boosting borrowing costs and crashing the leu currency. (Reporting by Luiza Ilie; editing by Giles Elgood)
