Oil prices climbed on Monday, reversing part of last week’s sharp losses, as investors looked ahead to potential discussions between the presidents of the United States and China that could ease renewed trade tensions between the world’s two largest economies and top energy consumers.
Brent crude oil, against which Nigerian crude oil is priced, rose by 94 cents, or 1.5% to $63.67 per barrel, while U.S. West Texas Intermediate (WTI) gained 89 cents, or 1.54% to trade at $59.81 during early hours in London.
Analysts say the rebound reflects cautious optimism that a meeting between U.S. President Donald Trump and Chinese President Xi Jinping—expected to take place on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in South Korea—could revive momentum toward a new trade understanding.
Suvro Sarkar, energy analyst at DBS Bank, said last week’s selloff was triggered by two simultaneous factors: the temporary ceasefire in Gaza, which reduced geopolitical risk premiums, and escalating U.S.–China tariff threats that clouded global demand expectations.
“The correction now appears capped by the willingness of both parties to negotiate. The near-term direction of oil prices will hinge on the outcome of these talks,” Sarkar noted.
Market confidence was shaken late last week after China expanded its rare earth export controls, prompting Washington to threaten new trade barriers.
President Trump said he would impose 100% tariffs on certain Chinese exports to the United States, reigniting fears of a broader trade conflict.
However, comments from U.S. Trade Representative Jamison Greer on Sunday suggesting that the meeting could still go ahead helped stabilize sentiment.
Oil markets have shown sensitivity to U.S.–China trade developments since early 2024, when heightened tensions between both economies triggered volatility in commodities and global equities.
Analysts note that each escalation tends to push oil prices lower on fears of weakened industrial activity and reduced shipping volumes, while reconciliatory signals often prompt speculative buying.
On the demand side, data from China’s customs bureau showed that crude imports in September rose 3.9% year-on-year to 11.5 million barrels per day, providing a modest cushion for market sentiment.
The increase suggests that Chinese refiners continue to rebuild inventories and support domestic fuel supply even amid global trade uncertainty.
Meanwhile, geopolitical stability in the Middle East has eased some of the recent risk-driven price pressure. The U.S.-brokered ceasefire in Gaza, which began following the release of the first group of Israeli hostages by Hamas, has lowered concerns about potential supply disruptions from the region.
Energy traders said that while a prolonged truce could temporarily reduce the war-risk premium embedded in oil prices, broader fundamentals remain driven by macroeconomic conditions.
Despite the rebound, traders remain cautious. Brent and WTI are still trading more than 10% below their late-August peaks as investors weigh the combined effects of slower global growth, ample supply from non-OPEC producers, and the stronger U.S. dollar, which makes oil more expensive for holders of other currencies.
Analysts expect price volatility to persist in the coming days ahead of the APEC summit. “If the Trump–Xi meeting takes place and signals even a temporary pause in trade hostilities, oil prices could see a more sustained rally toward the $65–$67 range for Brent,” said a London-based commodity strategist. “However, any cancellation or escalation could easily erase today’s gains.”
In the longer term, the market’s focus will remain on how quickly global trade activity recovers and whether OPEC+ will adjust production targets before year-end.
