Oil Rebounds as White House Signals Openness to Deal With China
Oil rose after after the White House signaled openness to reach a deal with China to quell fresh trade tensions between the two biggest crude consumers.
Brent advanced above $63 a barrel after plunging 3.8% on Friday in its biggest drop since August. On Sunday, Donald Trump and Vice President JD Vance struck a slightly more conciliatory tone towards China, after an additional 100% tariff and export controls on the Asian nation were announced on Friday.
“We’ll be fine with China,” the US president told reporters on Air Force One in early Asian hours on Monday, although the tariffs on Nov. 1 remained the plan. He also said he’d consider arming Ukraine with long-range Tomahawk missiles that would allow strikes deeper into Russia, which increases the risk of further disruptions to oil supply from the OPEC+ member.
“Crude oil prices rebounded after Trump signaled openness to a deal with China to ease trade tensions,” said Ole Hansen, head of commodities strategy at Saxo Bank. “Technically, both WTI and Brent remain weak but are still confined within their established trading ranges.”
China’s move to levy fees on US-owned vessels arriving at its shores prompted last-minute cancellations across ship types, including oil tankers, leading to a jump in shipping rates. The taxes, which take effect from Oct. 14, mirror those implemented by Washington on Chinese vessels as the Trump administration takes aim at the Asian nation’s dominance in global logistics and shipbuilding.
The measures have added uncertainty to the outlook for oil, which dropped over the past two weeks as the Organization of the Petroleum Exporting Countries and its partners add barrels to the market, threatening to exacerbate excess supply that’s forecast for later this year. The alliance increased output by 630,000 barrels a day in September, OPEC said its monthly market report.
Meanwhile, the ceasefire agreement between Israel and Hamas has reduced concerns about a flare-up in fighting in the Middle East, the source of a third of the world’s crude. Hamas freed all remaining living Israeli hostages from the Gaza Strip on Monday.
Source : Bloomberg.com
