Oil prices rise on hopes of global trade progress

July 29, 2025(MLN): Oil prices extended gains on Tuesday, buoyed by optimism over a U.S.-EU trade agreement, the possibility of a U.S.-China tariff truce, and President Donald Trump’s shortened deadline for Russia to resolve the Ukraine conflict.

Brent crude futures increased by $0.33, or 0.47%, to $70.37 per barrel. 

West Texas Intermediate (WTI) crude futures rose by $0.38, or 0.57%, to $67.09 per barrel by [3:25 pm] PST.

The market was buoyed by easing global trade tensions and renewed geopolitical concerns.

The recent U.S.-EU trade agreement, which includes a 15% import tariff on most European goods, helped avert a broader trade war that could have disrupted nearly one-third of global trade and weakened fuel demand.

Sentiment was further lifted by signs of progress in U.S.-China trade relations.

Senior economic officials from both nations held over five hours of talks in Stockholm on Monday, with negotiations expected to continue on Tuesday—raising hopes of a potential extension to the current tariff truce.

Geopolitical tensions also played a role in supporting oil prices. On Monday, former President Donald Trump issued a fresh ultimatum, giving Russia "10 or 12 days" to show progress in ending the war in Ukraine or face new sanctions.

He also threatened penalties on both Russia and its energy buyers, as CNBC reported.

These developments added to concerns over disruptions in Russian oil supply, especially following the EU’s latest sanctions package, which includes a tighter price cap on Russian crude and restrictions on importing refined products made with Russian oil.

“Trump’s comments reignited fears that Russia’s oil flows would be impacted,” noted Daniel Hynes, senior commodity strategist at ANZ.

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