Oil prices were steady in Asian trading on Tuesday after sharp gains in the previous session, fueled by supply concerns following President Donald Trump’s announcement of a shortened deadline for Russia to end the war in Ukraine.
Oil was also supported by the progress in U.S. trade deals ahead of the August 1 tariff deadline. The European Union signed a framework agreement on Sunday, easing tariff concerns and boosting expectations for future energy demand.
Brent Oil Futures expiring in September inched up 0.1% to $70.09 a barrel by 21:53 ET (01:53 GMT), while U.S. West Texas Intermediate (WTI) crude futures were muted at $66.74 per barrel.
Both contracts jumped more than 2% on Monday after Trump’s remarks on Russia.
Tuesday’s muted moves reflected investor caution ahead of the Federal Reserve meeting beginning later in the day and a slew of key U.S. economic data due this week.
Trump shortens deadline for Russia to end Ukraine war
U.S. President Donald Trump raised geopolitical tensions by reducing the deadline for Russia to make progress toward ending the war in Ukraine to just 10 or 12 days.
He warned of sanctions if Russia fails to respond, triggering concerns about disruptions to Russian oil flows and tightening supply expectations
"No deal could see Russia facing tougher US sanctions, along with the US imposing secondary tariffs of 100% on trading partners that import Russian oil," ING analysts said in a note.
"If imposed and enforced strictly, it would cause a significant shift in the oil outlook," analysts wrote, noting that India, China, and Turkey have ramped up purchases of Russian crude since the start of the Ukraine war. They added that these countries must now weigh cheaper crude against possible steep U.S. export tariffs.
US trade deals, OPEC+, Fed meet in focus
Market participants also assessed U.S trade deal progress ahead of Trump’s looming deadline.
The U.S.–EU agreement announced Sunday sets a 15% tariff on most European exports to the United States, down from a threatened 30%. It includes a commitment by the EU to buy $750 billion worth of U.S. energy products over the coming years.
Analysts said that the combination of reduced trade uncertainty and long‑term demand pledges lifted investor risk appetite and underpinned oil prices.
On the supply side, an OPEC+ panel called for full compliance with agreed quotas as a ministerial meeting, due August 3, prepares to consider an increase in production for September.
Investors remain cautious as markets look ahead to U.S. economic data and the Federal Reserve policy meeting.
The central bank begins its two‑day meeting on Tuesday and is expected to hold interest rates steady in the 4.25%–4.50% range.
Source : Investing.com