Oil prices ease off 2-week highs after US, China pause tariff war
KUALA LUMPUR: Oil prices eased on Tuesday from a two-week high reached during the previous session after the US and China agreed to temporarily slash tariffs, sparking optimism that a trade war between the world's two biggest economies would come to an end.
The US and China agreed to slash steep tariffs for at least 90 days, sending Wall Street stocks, the US dollar and crude prices sharply higher on Monday.
But underlying schisms that led to the dispute remain, including the US trade deficit with China and US President Donald Trump's demand for more action from Beijing to combat the US fentanyl crisis.
Brent crude futures dropped 14 cents, or 0.2 per cent, to US$64.82 per barrel by 0011 GMT. US West Texas Intermediate (WTI) crude fell 13 cents, or 0.2 per cent, to US$61.82.
Both benchmarks closed about 1.5 per cent higher on Monday at their steepest settlements since April 28. The gains come during a turbulent time for global oil markets.
Last month, oil prices fell to a four-year low on investor worries that the US-China trade war could depress economic growth and oil demand. Furthermore, the Organisation of the Petroleum Exporting Countries (OPEC) decided to boost oil output by more than previously expected. (Reporting by Stephanie Kelly; Editing by Jacqueline Wong)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
an hour ago
- The Star
UK timeline for US deal is too ambitious
Prime Minister Keir Starmer delivers a statement on Defence spending at Downing Street on February 25, 2025 in London, England. Earlier today Prime Minister Keir Starmer announced a commitment to increase the UK's defence spending to 2.5% of GDP by 2027, along with the goal of increasing it to 3% during the next parliament. Leon Neal/Pool via REUTERS LONDON: Prime Minister Keir Starmer would need President Donald Trump to be 'extraordinarily generous' to meet his ambition of finalising the UK-US tariff deal in two weeks, according to Britain's former top trade negotiator. Crawford Falconer, who led British trade negotiations until late last year, cast doubts on the UK government's efforts to settle remaining issues within a fortnight. While Starmer and Trump announced the so-called Economic Prosperity Deal to great fanfare in early May, numerous details have yet to be finalised. 'My assumption is that they're expecting the United States to be extraordinarily generous and understanding toward them,' Falconer told Bloomberg News. 'Because otherwise I think it would take longer than two weeks.' That assessment will come as a blow to Starmer as he tries to seize on the United Kingdom's status as the first country to agree to a trade deal with Trump this year. Last Tuesday, the White House ramped up the pressure, giving the United Kingdom five weeks to resolve outstanding issues or risk a doubling of US tariffs on British steel and aluminium imports to 50%. Trump's tariffs are already weighing on the United Kingdom's beleaguered steel industry, with some manufacturers saying American orders have dried up. Starmer dismissed concerns in Parliament last Wednesday, telling lawmakers he expected a resolution within a 'couple of weeks'. — Bloomberg
The Star
an hour ago
- The Star
Banker backs DEI at Tokyo parade amid backlash
TOKYO: The head of one of Japan's largest investment banks used the Tokyo Pride parade to strike a rare public stance on pushing ahead with diversity initiatives, as US President Donald Trump seeks to abolish such policies. Few Japanese corporate executives have taken a clear position on United States efforts to roll back the diversity, equity and inclusion (DEI) policies that had become common at global corporations, though many firms appear to have quietly maintained their initiatives. 'Even if the United States has adopted an anti-DEI policy, Japan should press ahead and make up for lost time rather than following suit,' said Akihiko Ogino, president and chief executive officer of Daiwa Securities Group Inc, before the start of the Tokyo Pride parade near the bustling Shibuya area. He was speaking yesterday at his first visit to the Tokyo iteration of the global event that organisers describe as 'advocating LGBTQ+ rights and dignity'. Faced with a rapidly ageing and shrinking population, some Japanese firms have sought to bolster the pool of available workers by becoming more inclusive of different gender and sexual minorities, as well as women. Major financial firms including Nomura Holdings Inc, Goldman Sachs Group Inc and Deutsche Bank AG are also among the sponsors of the event, according to its website. Companies around the world that do business in the United States have faced a dilemma in dealing with the abrupt about-face on the issue. Trump has vowed to stamp out diversity policies across the board, saying they are illegal and have disastrous consequences. In response, Citigroup Inc withdrew its ambitious DEI goals, and other US financial firms have made adjustments. Ogino said he doesn't necessarily oppose the anti-DEI movement in the United States but that he thinks it's 'important to recognise that there are people with different viewpoints and work together within an organisation'. 'I believe we should acknowledge such diversity, recognise the differences between ourselves and others, and work together while respecting each other,' he said. Daiwa earned less than 7% of its ordinary profit last fiscal year through businesses in the Americas as a whole. Japanese automakers Nissan Motor Co and Toyota Motor Co rolled back some initiatives in the United States last year after pressure from conservative activists like Robby Starbuck. — Bloomberg
New Straits Times
8 hours ago
- New Straits Times
China's rare earth dominance reshapes trade war battlefield
China has signalled for more than 15 years that it was looking to wea-ponise areas of the global supply chain, a strategy modelled on longstanding American export controls Beijing views as aimed at stalling its rise. The scramble in recent weeks to secure export licences for rare earths, capped by Thursday's telephone call between US and Chinese leaders Donald Trump and Xi Jinping, shows China has devised a better, more precisely targeted weapon for trade war. Industry executives and analysts say while China is showing signs of approving more exports of the key elements, it will not dismantle its new system. Modelled on the United States' own, Beijing's export licence system gives it unprecedented insight into supplier chokepoints in areas ranging from motors for electric vehicles to flight-control systems for guided missiles. "China originally took inspiration for these export control methods from the comprehensive US sanctions regime," said Zhu Junwei, a scholar at the Grandview Institution, a Beijing-based think tank focused on international relations. "China has been trying to build its own export control systems since then, to be used as a last resort." After Thursday's call, Trump said both leaders had been "straightening out some of the points, having to do mostly with rare earth magnets and some other things". He did not say whether China committed to speeding up licences for exports of rare earth magnets, after Washington curbed exports of chip design software and jet engines to Beijing in response to its perceived slow-rolling on licences. China holds a near-monopoly on rare earth magnets, a crucial component in EV motors. In April, it added some of the most sophisticated types to an export control list in its trade war with the US, forcing all exporters to apply to Beijing for licences. That put a once-obscure department of China's commerce ministry, with a staff of about 60, in charge of a chokepoint for global manufacturing. Several European auto suppliers shut down production lines last week after running out of supplies. While China's April curbs coincided with a broader package of retaliation against Washington's tariffs, the measures apply globally. "Beijing has a degree of plausible deniability — no one can prove China is doing this on purpose," said Noah Barkin, senior adviser at Rhodium Group, a China-focused US think tank. "But the rate of approvals is a pretty clear signal that China is sending a message, exerting pressure to prevent trade negotiations with the US leading to additional technology control." Even if the pace of export approvals quickens as Trump suggested, the new system gives Beijing unprecedented glimpses of how companies in a supply chain deploy the rare earths it processes, European and US executives have warned. Other governments are denied that insight because of the complexity of supply chain operations. For example, hundreds of Japanese suppliers are believed to need China to approve export licences for rare earth magnets in coming weeks to avert production disruptions, said a person who has lobbied on their behalf with Beijing. "It's sharpening China's scal-pel," said a US-based executive at a company seeking to piece together an alternative supply chain.. As early as 1992, former Chinese leader Deng Xiaoping was quoted as saying, "The Middle East has oil, China has rare earths". Beijing's landmark 2020 Export Control Law broadened curbs to cover any items affecting national security — from critical goods and materials to technology and data. China has since built its own sanctions power while pouring the equivalent of billions of dollars into developing work-arounds in response to US policies. In 2022, the US put sweeping curbs on sales of advanced semiconductor chips and tools to China over concerns the technology could advance Beijing's military power. But the move failed to halt China's development of advanced chips and artificial intelligence, analysts have said. Beijing punched back a year later by introducing export licences for gallium and germanium, and some graphite products. Exports to the US of the two critical minerals, along with germanium, were banned last December. In February, China restricted exports of five more metals key to the defence and clean energy industries.
