Oil: Tariff pause provides some relief – ING
|Oil prices rallied along with risk assets yesterday after President Trump paused reciprocal tariffs on most trading partners, at least those that haven’t retaliated yet. This puts tariffs back to the baseline 10%, ING’s commodity analysts Warren Patterson and Ewa Manthey note.
Oil rallies on tariff pause, but China hit hard
"However, there was no relief for China. The US increased tariffs to 125% after China raised retaliatory tariffs on US goods to 84%. While the pause offers some relief to markets, there’s still plenty of uncertainty on the trade front. This uncertainty is still likely to drag on global growth, which is clearly a concern for oil demand. Still, conditions are not looking as bad as they were just a few days ago."
"The ICE Brent forward curve is signalling a better-supplied oil market, at least across parts of the forward curve. While the front end of the curve is in backwardation, it has shifted into contango from the January 2026 contract onwards. Meanwhile, the Brent Dec-25 - Dec-26 spread has fallen into contango. All signs point to a softer market balance a little bit further down the road."
"US inventory data from the Energy Information Administration (EIA) shows that crude oil inventories increased by 2.55m barrels over the last week. This takes stocks to a little over 442m barrels -- the highest since July. Meanwhile, crude stocks at Cushing grew by 681k barrels, leaving stocks at the WTI delivery hub at their highest level since November. The slightly bearish crude numbers were offset by refined products, with gasoline and distillate stocks falling by 1.6m barrels and 3.5m barrels, respectively."
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