Oil prices rose on Thursday after Donald Trump signaled a major trade deal announcement, expected to involve the United Kingdom. Brent crude moved toward $61.5 a barrel and WTI hovered around $58.50, recovering slightly from recent losses.
While Trump didn’t name the country involved, sources say the deal will likely be with the UK. The agreement is seen as a potential boost to investor sentiment, especially after market turbulence caused by global tariffs and rising oil supply.
The news arrives just ahead of U.S.-China trade talks, though Trump has ruled out easing tariffs on China as a precondition. Still, even limited progress on trade could calm markets shaken by slowing growth and inflation concerns.
U.S. crude inventories dropped for a second straight week, hitting their lowest since March, with Cushing stockpiles also declining. However, supply remains a concern: OPEC+ announced a second consecutive monthly production increase, adding 411,000 barrels per day in June.
Meanwhile, Citi Research cut its short-term Brent forecast from $60 to $55 per barrel, citing renewed U.S.-Iran nuclear talks. A successful deal could increase supply and drive prices toward $50. Without a deal, tensions could push prices back above $70, Citi noted.
Despite the recent drop, Citi maintains its long-term Brent forecast at $60 for 2025, while ANZ kept its three-month target at $55, warning of continued downside risks due to oversupply and weak demand signals.