Oil prices climbed in early trading on Monday after U.S. and Chinese economic officials outlined a framework for a trade agreement, easing concerns that tariffs and export restrictions between the world’s two largest oil consumers could dampen global economic growth.
As of 00:27 GMT, Brent crude futures rose 46 cents, or 0.7%, to $66.40 per barrel, while U.S. West Texas Intermediate (WTI) gained 46 cents, or 0.75%, to $61.96 per barrel. Both benchmarks posted strong weekly gains last week—8.9% for Brent and 7.7% for WTI—driven by U.S. and European sanctions on Russia.
In a note, Haitong Securities said that market sentiment has improved as easing U.S.-China tensions and new sanctions on Russia helped offset earlier fears of a crude supply glut.
U.S. Treasury Secretary Scott Besant said Sunday that American and Chinese officials reached a “very substantial framework” for a trade agreement during talks in Kuala Lumpur. The framework aims to avert 100% U.S. tariffs on Chinese goods and delay China’s planned export controls on rare earth minerals, paving the way for further discussions between President Donald Trump and President Xi Jinping later this week.
Analysts said the agreement framework provided a positive counterbalance to concerns that Russia could circumvent sanctions on Rosneft and Lukoil by offering deeper discounts and using “shadow fleets” to attract buyers. However, Yang An, an analyst at Haitong Securities, cautioned that “if sanctions on the Russian energy sector prove less effective than expected, oversupply pressures could re-emerge in the market.”
