Oil Edges Higher as EU Agrees to US Trade Deal Ahead of Deadline

Oil rose after the US and European Union agreed on a trade deal ahead of President Donald Trump’s tariff deadline of Aug. 1, Bloomberg reported.

Brent was near $69 a barrel after closing 1.1% lower on Friday, and West Texas Intermediate traded above $65. The EU faces 15% levies on most of its exports, although Trump and European Commission President Ursula von der Leyen appeared to differ on some key details of the agreement.

The US-EU deal has supported sentiment, but the market had already been given some indication of expected tariff levels from past agreements, said Soni Kumari, a commodity strategist at ANZ Group Holdings Ltd. Oil prices should remain in the current range until there’s clarity around further trade pacts and the outcome from the upcoming OPEC+ meeting on supply, she added.

Trump’s trade policies and threats of retaliation from targeted countries have raised concerns about the outlook for global economic growth, weighing on oil and other commodities. The decision by OPEC+ to rapidly increase its output quotas has also put the market on track for a glut later this year.

An OPEC+ committee will convene later on Monday to assess the oil market ahead of a meeting on Sunday to decide on production policy for September. The group is expected to hike its quota again, according to delegates.

Trump and von der Leyen announced the trade pact on Sunday, although they didn’t disclose the full details or release any written materials. The US, which has also reached an agreement with Japan, set a deadline of Aug. 1 to conclude deals with its trading partners before American tariffs take effect.

US and Chinese officials are scheduled to meet on Monday for trade talks, and the South China Morning Post reported that the two countries are expected to extend their tariff truce, according to people it didn’t identify.