US-EU trade deal sparks oil price increase
Oil prices rose on Monday as investors assessed a trade deal between the United States and the European Union that averted 30 per cent tariffs on most EU goods.
Brent crude futures were up 76 cents, or 1.1 per cent, to $69.20 a barrel by 10:28 GMT, while U.S. West Texas Intermediate crude stood at $65.90 a barrel, up 74 cents, or 1.1 per cent.
The US-European Union trade deal and a possible extension of the US-China tariff pause are supporting global financial markets and oil prices, IG markets analyst Tony Sycamore said.
Sunday's US-EU framework trade pact sets an import tariff of 15 per cent on most EU goods, while US President Trump said the deal calls for $750 billion of EU purchases of US energy in the coming years.
Senior US and Chinese officials will meet in Stockholm on Monday to try to extend a tariff truce before an August 12 deadline.
The US-EU deal removed another layer of uncertainty and the focus seems to be shifting back towards fundamentals, while the strong dollar and falling Indian crude oil imports have weighed on prices, PVM analyst Tamas Varga said.
On the supply side, an OPEC+ panel is unlikely to alter existing plans to raise oil output when it meets on Monday, four OPEC+ delegates told Reuters on July 25.
ING expects OPEC+ will at least complete the full return of 2.2 million barrels per day of the additional voluntary supply cuts by the end of September.
Also on the supply side, Venezuela's state-run oil company PDVSA is readying to resume work, once Trump reinstates authorisations for its partners to operate and export oil under swaps, company sources said.
In the Middle East, Yemen's Houthis said on Sunday they would target ships of companies that do business with Israeli ports, regardless of nationality, in what they called a fourth phase of military operations against Israel over the Gaza conflict.
(Reporting by Enes Tunagur in London, Florence Tan in Singapore and Sam Li in Beijing; Editing by Clarence Fernandez, Jacqueline Wong, Giles Elgood and Barbara Lewis)
