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19m ago

Oil Prices Waver Following U.S.-China Tariff Truce and Rising OPEC+ Supply

A 90-day tariff pause between the U.S. and China temporarily boosted crude prices, but questions over the truce’s durability and increased supply weigh on the market.

Immigration inspection officers in protective suits check a tanker carrying imported crude oil at the port in Qingdao, Shandong province, China May 9, 2022. Picture taken May 9, 2022. China Daily via REUTERS./File Photo
A pump jack operates near a crude oil reserve in the Permian Basin oil field near Midland, Texas, U.S. February 18, 2025. REUTERS/Eli Hartman/File Photo
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Overview

  • The U.S. and China agreed to a 90-day suspension of steep tariffs, briefly lifting oil prices to two-week highs before a subsequent pullback.
  • Brent crude futures rose to $65.46 per barrel and WTI to $62.49 before easing as markets assessed the potential for a lasting trade resolution.
  • OPEC+ has increased oil output more than expected, with further supply hikes scheduled for May and June, potentially capping price gains.
  • Saudi Arabia’s crude shipments to China are set to remain steady in June after reaching a one-year high, highlighting stable demand from the region.
  • Reduced refining capacity in the U.S. and Europe continues to tighten fuel markets, increasing vulnerability to price spikes during supply disruptions.