Oil Rises Again, But Will It Last?
Global oil prices rose as the market grew more confident that US-China trade relations would cool down. Hopes of a deal between President Donald Trump and President Xi Jinping have investors viewing the global energy demand outlook as more positive. Brent is currently trading around $66.4 per barrel and WTI around $61.9 per barrel at the start of trading on Monday, October 27, 2025. Both continued to strengthen after strong gains last week.
This sentiment emerged after US and Chinese negotiators said they had reached a preliminary agreement on several sensitive issues, from tariffs to export controls. The threat of 100% tariffs on Chinese goods was said to be "practically off the table," and Beijing was reportedly prepared to suspend exports of rare earth minerals for a year. The market read this as a signal: the risk of an immediate trade war has decreased, the global economy can breathe a little easier, and oil consumption can remain strong.
At the same time, oil prices were also supported by another geopolitical factor: the United States imposed sanctions on Russia's two largest oil producers. These sanctions have made Russian oil exports to major buyers like India and China more complicated and expensive, forcing those countries to seek alternative supplies. This has helped keep prices from plummeting, even though the oil market is still plagued by concerns about oversupply from OPEC+ and low global inventories.
Despite the bullish sentiment, analysts say this oil rally isn't necessarily wild. Global supply is still considered excessive, so gains are likely to be limited to the upper $60s per barrel, rather than a dramatic jump. This means that the current oil momentum still depends heavily on two factors: 1) whether a US-China trade deal actually materializes when Trump and Xi meet this week, and 2) whether the Russian sanctions actually reduce physical supply, rather than simply redirecting trade flows through new channels. (asd)
Source: Newsmaker.id
