Oil prices rose on Tuesday after the United States and China extended a pause on higher tariffs, reducing fears that an intensifying trade war could weigh on global fuel demand.
Brent crude futures gained 26 cents, or 0.39%, to $66.89 a barrel, while U.S. West Texas Intermediate futures rose 22 cents, or 0.34%, to $64.18.
The move follows U.S. President Donald Trump’s decision to extend the tariff truce by 90 days, staving off increased duties on Chinese imports during the critical holiday shopping season.
Market Hopes for Broader Agreement
The extension has renewed hopes for a broader deal between the world’s two largest economies.
Tariffs threaten to slow global economic growth, which could in turn reduce oil consumption.
Investors are also eyeing a planned meeting between Trump and Russian President Vladimir Putin on August 15 in Alaska, aimed at negotiating an end to the war in Ukraine.
Any resolution could ease concerns about disruptions to Russian oil supply.
Geopolitical Pressures in Play
The U.S. has threatened secondary sanctions on buyers of Russian oil, including China and India, if no peace deal is reached.
Trump had set a deadline for Russia to agree to terms or face increased penalties.
Washington has also urged Beijing to cut purchases of Russian crude, with potential tariffs looming.
The risk of such measures being implemented has diminished ahead of the scheduled talks.
Economic Data Could Influence Prices
Traders are also awaiting U.S. inflation figures due later in the day, which could provide clues about the Federal Reserve’s next interest rate moves.
Signs of an impending rate cut could bolster crude demand by supporting economic growth.
Analysts say that while the tariff pause offers short-term relief for oil markets, the outcome of the Trump-Putin meeting and global economic indicators will be key to determining whether prices can sustain their current levels.