Oil prices rose slightly on Tuesday as investors watched the outcome of trade discussions between the United States and China. Many hope the talks will lead to an easing of tensions, boosting fuel demand and giving the global economy a lift.
Brent crude rose 12 cents to $67.16 per barrel, while U.S. West Texas Intermediate gained 13 cents to reach $65.42. Earlier in the session, prices touched their highest levels since early April. Monday also saw strong performance as Brent reached $67.19, the highest since late April.
The trade talks, continuing for a second day in London, are seen as a potential turning point. Both countries have been locked in disputes over tariffs and rare earth exports, which have caused disruptions in global trade and fears of slower economic growth.
U.S. President Donald Trump said the talks were progressing well and that his team had sent positive feedback. A trade deal could mean increased economic activity and, as a result, higher oil demand.
In other news, Iran announced it would soon present a counter-offer for a nuclear agreement in response to a U.S. proposal it called unacceptable. The disagreement centers on whether Iran can continue enriching uranium on its own soil. Iran, being a top oil producer in OPEC, may increase its exports if U.S. sanctions are relaxed. This could bring more oil to the market, pushing prices down.
OPEC’s production in May increased, although slightly. Iraq reduced its output to balance earlier overproduction, while Saudi Arabia and the UAE also made only limited increases. OPEC+—which includes OPEC and other major producers like Russia—is moving ahead with plans to reduce restrictions on oil output.
As supply continues to increase and the group shifts towards a market-driven strategy, there’s concern that the second half of 2025 could see an oversupply of oil, putting downward pressure on prices.
