Brent moves higher following 90-day pause on some US tariffs

Front-month ICE Brent has gained by $2.29/bbl on the day, to trade at $63.41/bbl at 09.00 GMT.

IMAGE: Crude oil barrels. Getty Images

Upward pressure:

Brent crude futures have found some upward thrust after US President Donald Trump announced a 90-day pause on the country-specific tariffs for most trade partners, just a day after they came into effect.

“Oil prices rallied along with risk assets yesterday after President Trump paused reciprocal tariffs on most trading partners, at least those that haven’t retaliated yet,” two analysts from ING Bank said.

The news has eased some demand concerns as global markets await the outcomes of trade negotiations between Washington and its partners.

But lingering uncertainty could weigh on global economic growth, “which is clearly a concern for oil demand,” ING Bank analysts said. “Still, conditions are not looking as bad as they were just a few days ago,” they added.

Downward pressure:

Brent’s price gains have been capped as the Trump administration hardened its stance on China by raising total import tariffs to 125%, effective immediately.

“There’s still plenty of uncertainty as the US again increased tariffs on China,” ING Bank analysts noted.

Earlier this week, the US had hit Beijing with a total 104% in tariffs. This was later countered by China with an announcement of 84% tariffs on US goods, which in turn prompted President Trump to hike its tariffs further to 125%.

“The US dug in its heels over China, with Trump on Wednesday ratcheting up cumulative import duties against the country to 125%,” Vanda Insights’ founder and analyst Vandana Hari remarked.

By Aparupa Mazumder

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