Oil prices edged higher in Asian trading on Friday, set to break a three-week losing streak, driven by increased fuel demand and optimism that U.S. reciprocal tariffs wouldn’t take effect until April, leaving room for diplomatic resolution.
By 0505 GMT, Brent crude climbed 23 cents (0.3%) to $75.25 per barrel, while U.S. West Texas Intermediate (WTI) rose 16 cents (0.2%) to $71.45 per barrel. Over the week, Brent gained 0.6%, with WTI up 0.5%.
Trade Tariffs Delay Supports Oil Prices
On Thursday, U.S. President Donald Trump directed officials to examine reciprocal tariffs against nations imposing duties on U.S. goods, with a deadline for recommendations set for April 1.
“Positive development on the trade front in light of U.S. tariff delays paves the way for some recovery in oil prices this morning, as the risk environment warms up to the prospects of further trade consensus being reached,” said Yeap Jun Rong, a market strategist at IG.
However, Yeap warned that gains might be limited as the market assesses the potential return of Russian oil supplies amid peace talks between Russia and Ukraine.
Russia-Ukraine Talks Raise Supply Concerns
Speculation over Ukraine-Russia peace negotiations kept traders wary, as an end to sanctions on Moscow could significantly boost global oil supplies.
Trump recently instructed U.S. officials to initiate discussions aimed at ending the conflict, following separate phone conversations with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy, both of whom signaled interest in a peace deal.
Rising Demand and Supply Adjustments
Despite geopolitical uncertainties, Russian crude exports remain steady, with the International Energy Agency (IEA) noting that production increased slightly last month, suggesting that workarounds to U.S. sanctions may be sustaining output.
Meanwhile, JPMorgan analysts reported a global oil demand surge to 103.4 million barrels per day, a 1.4 million bpd year-over-year rise.
“Initially sluggish, demand for mobility and heating fuels picked up in the second week of February, suggesting the gap between actual and projected demand will soon narrow,” JPMorgan stated.
Additionally, rising gas prices in Europe could drive a shift toward oil usage, further supporting demand.