Oil steadies after Trump extends EU trade talks deadline

Oil prices steadied on Monday after US President Donald Trump extended a deadline for trade talks with the European Union, easing concerns about US tariffs on the bloc that could hit fuel demand.

Brent crude futures were down 17 cents at US$64.61 a barrel at 8:35 ET while US West Texas Intermediate crude was down 18 cents to US$61.35 a barrel.

Both contracts had traded higher earlier in the session after Trump said he agreed to extend a deadline for trade talks with the European Union until July 9, marking another temporary trade policy reprieve.

Global markets climbed on Monday and the euro rallied after Trump delayed his threat to slap 50 per cent tariffs on EU goods.

“Trump’s pivot, by postponing higher tariffs for the EU, and his comments on possible sanctions on Russia are moderately supporting crude prices today,” UBS analyst Giovanni Staunovo said.

Trading volumes are expected to be light Monday due to the US Memorial Day holiday.

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Trump separately said in a social media post that Russian President Vladimir Putin had “gone absolutely CRAZY” by unleashing the largest aerial attack of the war on Ukraine and that he was weighing new sanctions on Moscow.

Brent and WTI traded higher on Friday as limited progress in US-Iran nuclear talks quashed expectations more Iranian oil will return to global markets, and as US buyers covered positions ahead of the three-day Memorial Day weekend.

Prices on Friday also drew strength from data from energy services firm Baker Hughes that showed US firms cut the number of operating oil rigs by eight to 465 last week, the lowest since November 2021, raising the chance of tighter supplies in future.

The gains were capped by expectations that the Organization of the Petroleum Exporting Countries and its allies, a group known as Opec+, could decide to increase output by another 411,000 barrels per day for July at a meeting on Sunday.

Reuters reported this month that the group could unwind the rest of its 2.2 million bpd voluntary production cut by the end of October, having already raised output targets by about 1 million bpd for April, May and June. REUTERS