%Oil prices are recovering as the U.S. announces trade deals with countries such as Japan and amid reports of a sharp decline in American crude inventories.
Brent crude oil, the international standard, is up 1% and trading at $69.17 U.S. a barrel. West Texas Intermediate (WTI) crude, the U.S. benchmark, is also up 1% at $65.95 U.S. per barrel.
Commodities analysts say that energy markets are now focused on U.S.-European Union trade talks and whether the two powers can reach a negotiated deal before U.S. President Donald Trump’s August 1 tariff deadline.
A recent trade deal with Japan lowers duties on automotive imports and spares the Asian nation from any new levies in exchange for a $550 billion U.S. package of investments and loans.
Still, uncertainty over U.S.-China trade negotiations and the ongoing war between Ukraine and Russia is limiting further upside in oil prices, say analysts.
In recent months, WTI crude oil has been range-bound between $60 U.S. and $70 U.S. a barrel.
On the supply side, the U.S. Energy Information Administration has reported that U.S. crude oil inventories fell last week by 3.2 million barrels to a total of 419 million barrels.
That decline was greater than the 1.6-million-barrel drawdown expected among analysts.
Separately, foreign oil tankers were temporarily prevented from loading at Russia’s main Black Sea port due to new regulations, effectively halting exports from Kazakhstan.
And, the U.S. government has reiterated that it is considering sanctions on Russian oil to end the war in Ukraine.
