Crude oil prices climbed on renewed optimism over global trade, following U.S. President Donald Trump’s announcement of plans to ease tariffs on Chinese exports. The move signaled a potential thaw in the long-running trade war between the world’s two largest economies, boosting market sentiment and fueling demand expectations.
Brent crude rose 1.5% to $68.45 per barrel, while West Texas Intermediate (WTI) increased 1.55% to $64.66 per barrel. The rally marks a rebound for Brent, which had slipped below $65 after the U.S. initially escalated reciprocal tariffs on Chinese goods.
The positive market response followed Trump’s statement at a White House press conference, where he acknowledged that tariffs on Chinese goods would “come down substantially,” though not be eliminated entirely. His comments echoed earlier remarks from Treasury Secretary Scott Bessent, who described the current tariff levels as “unsustainable” and predicted a “de-escalation” of trade tensions.
Meanwhile, OPEC and its allies (OPEC+) have agreed to increase oil production starting in May. While some analysts warn that this could lead to a supply glut and downward pressure on prices, others argue that rising demand—especially from Asia—may absorb the additional output.
Uncertainty over U.S. trade policy continues to influence oil markets. Trump’s growing criticism of Federal Reserve Chair Jerome Powell has raised concerns about the Fed’s independence, contributing to a weakening U.S. dollar. The dollar’s depreciation is making oil cheaper for foreign buyers, further supporting crude demand and price increases.
However, despite the short-term bullish sentiment, market gains remain tempered by lingering fears of a global economic slowdown. The trade war—although easing—still looms over global growth prospects, especially given China’s status as the world’s largest oil importer.
Trump’s administration had earlier imposed tariffs of up to 145% on Chinese imports, prompting retaliatory duties of 125% on American goods. Broader U.S. trade policies targeting multiple countries have weighed on investor confidence, impacting stock markets and driving up interest rates on U.S. debt due to concerns over slowing growth and inflationary risks.
