Oil prices extended their rally above $70 per barrel on Tuesday as easing global trade tensions and heightened geopolitical risks surrounding Russia lifted market sentiment.
Brent crude oil, against which Nigerian crude oil is priced, rose 1.5 percent to $70.35 a barrel while U.S. West Texas Intermediate (WTI) gained 1.3 percent to $66.90.
The uptick represents the highest price levels since mid-July as investors responded positively to a U.S.–European Union trade agreement and renewed pressure on Moscow over sanctions.
Market Drivers
The U.S. and EU over the weekend reached a framework trade pact that averted steep tariffs on European goods, calming fears of a prolonged transatlantic trade conflict.
The deal is expected to stimulate broader demand across global markets, including energy.
Adding to the upward momentum, President Donald Trump announced plans to shorten the timeline for new sanctions against Russia, citing concerns over the country’s continued military posture in Eastern Europe.
Analysts said the move heightened supply risks, further supporting oil prices.
Tony Sycamore, market analyst at IG, said “The combination of reduced trade uncertainty and potential Russian supply disruptions has created a supportive backdrop for oil. Investors are rotating back into energy as demand fundamentals look increasingly strong.”
OPEC+ Position
On the supply front, an OPEC+ panel is widely expected to maintain its current output strategy during this week’s meeting.
According to delegates, the group will proceed with plans to return 2.2 million barrels per day of voluntary supply cuts by the end of September, easing previous production curbs while balancing price stability.
ING analysts forecast that OPEC+ will “remain cautious in its output strategy, ensuring supply returns do not outpace recovering demand.”
Broader Market Outlook
Despite the rally, analysts cautioned that the strong U.S. dollar and declining crude imports from India could temper gains in the near term.
Tamas Varga of PVM Oil Associates observed that “While sentiment has improved, the strength of the dollar and softer demand indicators from key Asian buyers could act as a counterbalance in the short run.”
However, with global trade uncertainty easing and geopolitical risks intensifying, many market watchers expect Brent to remain above the $70 threshold in the coming weeks.
