Oil prices surged Monday morning after the US and China agreed to cut tariffs as part of a temporary trade truce. West Texas Intermediate and Brent Crude both experienced significant percentage increases following the announcement of the trade agreement. While the tariff reduction is seen as a positive step for the oil market, analysts warn that lasting impacts depend on broader US policies toward China. 1m ago 9:50am CST
CPC Blend Oil Exports Dip as Kazakhstan Reaffirms OPEC+ Commitment
Black Sea CPC Blend oil exports through the Caspian Pipeline Consortium (CPC) are projected to decline to 1.5 million barrels per day (bpd), or roughly 6 million metric tons, in May, down 6% from April’s 1.6 million bpd, according to industry sources. The drop, calculated by Reuters, reflects a slight reduction in daily shipments despite May having one more day than April. The CPC, which handles over 80% of Kazakhstan’s oil exports from fields like Tengiz to the Yuzhnaya Ozereyevka terminal near Novorossiisk, remains a critical artery for global oil supply.
Kazakhstan’s energy ministry reiterated its adherence to OPEC+ production quotas on Tuesday, emphasizing efforts to stabilize global energy markets. This follows tensions over the country’s prior overproduction, particularly from the Chevron-led Tengiz field. The ministry’s statement aligns with ongoing pressure from OPEC+ members, including Saudi Arabia, for compliance. The CPC’s export reduction may signal Kazakhstan’s move to curb output, though challenges persist in aligning major Western operators like Chevron and ExxonMobil, key CPC shareholders, with these commitments.
1m ago - 9:50am CST 26m ago 9:24am CST
U.S. House Bill Boosts SPR Refilling Efforts
As oil prices maintain their upward momentum, U.S. House Republicans have introduced a Budget Reconciliation Bill that allocates $1.321 billion to replenish the Strategic Petroleum Reserve (SPR) and $218 million for storage facility maintenance. The legislation, fulfilling a key pledge by President Donald Trump, also repeals the SPR drawdown mandate and redirects $6.5 billion from unspent climate initiatives, including environmental grants, to prioritize energy security.
“This bill strengthens our energy reserves while reversing wasteful spending,” said Congressman Brett Guthrie (KY-02) in a recent op-ed. The move addresses the SPR’s depletion after the Biden administration released over 180 million barrels since 2021 to counter high gasoline prices. The refill plan is seen as critical to stabilizing U.S. markets against potential global supply shocks, though some analysts question the timing given elevated crude prices. The energy sector remains in focus as investors weigh the bill’s implications alongside ongoing U.S.-China trade developments.
26m ago - 9:24am CST 36m ago 9:14am CST
U.S.-China Trade Deal Summary
In case you're just joining us, here are some of the key developments in what has been a very eventful morning in oil markets and beyond:
US-China Tariff Agreement: The US and China agreed to reduce tariffs on each other's goods for 90 days, de-escalating trade tensions. US tariffs on Chinese imports have been cut from 145% to 30%, and Chinese tariffs on US goods have been reduced from 125% to 10%.
US Markets Surge: The S&P 500 opened 2.9% higher, while the tech-heavy Nasdaq climbed 4.1% following the US-China tariff agreement. US markets are now trading at levels similar to the start of the year, marking a major recovery since the imposition of Trump's "Liberation Day" tariffs in April.
Broader Market Impact: The announcement sent the US dollar up 1.2% against a basket of global currencies, while oil prices initially surged by nearly 4% before falling back slightly. European and Asian markets also posted gains, reflecting optimism over the deal.
Political Response: President Trump declared the agreement a "total reset with China," marking it as a key achievement of his administration. Analysts noted that the tariff reductions were larger than expected, though the remaining 30% US tariff is still seen as high.
Analyst Commentary: ING's Chris Turner called the concessions "earlier and larger" than anticipated, while Capital Economics calculated that overall US tariffs on China would average around 40%, with Chinese tariffs on US goods dropping to about 25%.
36m ago - 9:14am CST 40m ago 9:10am CST
Oil Stocks Rally as Crude Prices Climb
The momentum sparked by the U.S.-China tariff reduction agreement fueled gains across the energy sector, with major oil companies posting significant advances.
Marathon Petroleum led the pack, surging 5.73%, followed closely by ConocoPhillips at 5.63%.
Chevron saw a solid 3.09% increase, while BP gained 2.32%.
European majors also joined the rally, with Equinor up 1.52%, Shell rising 1.16%, and TotalEnergies edging higher by 0.85%.
The tariff truce, which reins in elevated duties for 90 days, has bolstered market confidence in stronger oil demand, driving share prices of energy firms.
Equity markets mirrored the upbeat sentiment, with Dow futures jumping in early trading. Analysts now eye key resistance levels for oil, with WTI approaching $65 and Brent nearing $69.
While the tariff suspension offers a short-term boost, experts warn that sustained optimism hinges on the outcome of future discussions led by U.S. Treasury Secretary Scott Bessent, USTR Jamieson Greer, and China’s Vice Premier He Lifeng. For now, markets are riding a wave of relief, but uncertainties linger over the longevity of this détente.
40m ago - 9:10am CST 42m ago 9:08am CST
Markets Rally on U.S.-China Tariff Deal
The S&P 500 surged 2.9% at the open on Monday after the U.S. and China agreed to slash tariffs for 90 days, signaling a temporary de-escalation in their trade war. The tech-heavy Nasdaq also jumped 4.1% following the agreement, which came after weekend negotiations in Geneva. The deal will see the U.S. reducing tariffs on Chinese goods imposed during President Trump's second term from 145% to 30%, while China will lower retaliatory duties on U.S. imports from 125% to 10%.
The announcement boosted the U.S. dollar by 1.2% against a basket of currencies, and Brent crude oil prices rose 3.2% to $65.96 per barrel. Analysts described the tariff reductions as unexpectedly early and significant, with Chris Turner from ING highlighting the larger-than-anticipated concessions. Capital Economics estimated that, after the agreement, total U.S. tariffs on China would average around 40%, while Chinese tariffs on U.S. goods would be about 25%.
42m ago - 9:08am CST 47m ago 9:03am CST
Oil Prices Surge as U.S.-China Tariff Deal Sparks Optimism
Oil prices rallied sharply on Monday morning following a breakthrough in U.S.-China trade talks, alleviating fears of escalating trade tensions and boosting hopes for global economic growth. As of 10:00 CST, West Texas Intermediate (WTI) Crude climbed 3.24% to $63.00 per barrel, while Brent Crude, the global benchmark, rose 3.02% to $65.84 per barrel. The surge came after the White House announced that both nations agreed to slash tariffs by 15%, maintaining a 10% baseline rate for 90 days, as part of a temporary truce to foster further negotiations.
The agreement, reached during weekend talks in Geneva, signals a potential de-escalation in the trade war that has rattled markets and clouded the outlook for oil demand. “This tariff reduction is a positive step for pro-cyclical assets like oil, as it eases concerns about a demand slowdown,” said Maria Cortez, senior energy analyst at Global Markets Insights. However, she cautioned that the market’s enthusiasm could wane if broader U.S. policies toward China remain unchanged.
