Oil pushed higher for a second day as President Donald Trump said he had no intention of firing Federal Reserve Chair Jerome Powell, while also floating substantial cuts to tariffs on China.
Brent traded above $68, following a 1.8% gain on Tuesday. Wider markets also advanced on the dual relief of a possible thaw in US-China tensions and Trump's softer tone on the central bank chief. His post calling for Powell's “termination” fueled a global selloff at the start of the week.
In another bullish sign, the American Petroleum Institute reported that US crude stockpiles fell last week. Official data are due later.
“Oil prices are also benefiting from the tail winds of the Trump change of heart,” said John Evans, an analyst at brokerage PVM.
Oil's rebound on Tuesday was aided by speculation that Iranian flows may be curtailed after the US announced sanctions against liquefied petroleum gas magnate Seyed Asadoollah Emamjomeh and his corporate network. The Trump administration has previously vowed “maximum pressure” on Tehran.
Futures are clawing back some of this month's heavy loss that was spurred by rising tensions between the US and its top trading partners. In a closed-door investor summit on Tuesday, US Treasury Secretary Scott Bessent said the tariff standoff with China cannot be sustained and that the two countries will have to find ways to de-escalate.
Still, some market gauges are pointing to a stronger near-term market. The prompt spread for benchmark Brent is in the widest backwardation since January, a bullish structure that signals tighter supply.
Prices
Brent for June settlement gained 1.4% to $68.36 a barrel at 10:33 a.m. in London.
WTI for June delivery rose 1.5% to $64.60 a barrel.
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