Crude oil prices advanced sharply on Friday, with benchmark contracts poised for their strongest weekly performance in nearly two months. The surge follows signals of easing trade tensions between the United States and China—two of the world’s largest oil consumers—and a newly announced U.S.-U.K. trade deal that added to market confidence.
As of 10:21 GMT, Brent crude rose $1.19, or 1.9%, to $64.03 a barrel, while U.S. West Texas Intermediate (WTI) crude gained $1.21, or 2%, to $61.12. Both contracts are set to end the week with gains exceeding 4%, driven by improving sentiment in global markets.
Market optimism has been buoyed by the upcoming May 10 meeting in Switzerland between U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng. Traders are hopeful the talks could mark a shift toward formal negotiations, potentially unwinding damaging tariffs.
Easing Tariffs Could Add $2-$3/Barrel
Vandana Hari, founder of energy analytics firm Vanda Insights, noted that even a symbolic move to reduce tariffs during negotiations could result in an additional $2 to $3 per barrel in crude price gains.
Supporting this bullish view are China’s latest trade figures, which showed stronger-than-expected export growth in April and a narrowed import decline. Crude oil imports dipped slightly month-over-month but were still 7.5% higher than a year ago, reflecting strategic stockpiling by Chinese refiners during seasonal maintenance.
Key drivers behind the rally:
- Hopes for de-escalation in U.S.-China trade conflict
- Strength in Chinese export data
- Positive sentiment from U.K.-U.S. trade deal
- Ongoing refinery stockpiling in Asia
Still, some caution remains. While global trade tensions are cooling, supply-side dynamics continue to exert pressure on prices.
OPEC+ Plans Could Limit Further Gains
The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, are reportedly planning an output increase in the coming weeks. Though meant to stabilize markets, higher production may weigh on prices, particularly if demand doesn’t keep pace.
Interestingly, a Reuters survey revealed that OPEC’s oil output fell slightly in April, as supply disruptions in Libya, Venezuela, and Iraq outweighed planned increases elsewhere.
Meanwhile, Britain’s agreement to reduce tariffs on U.S. imports added another layer of optimism to the global trade narrative. However, the direct impact on crude demand is expected to be limited.
As markets await the outcome of this weekend’s U.S.-China talks, traders remain focused on both demand signals and production policy shifts that could shape oil’s next move.