Oil prices jumped more than 3% in Asian trading on Monday (May 12), reaching fresh intraday highs following a breakthrough in U.S.-China trade relations. The two economic giants announced a 90-day rollback of tariffs, rekindling hopes of a broader trade agreement.
Brent crude rose as high as $66.30 per barrel, while U.S. West Texas Intermediate (WTI) touched $63.41. At the time of reporting, Brent was up 2.5% at $64.14, and WTI had gained 2.7% to trade at $63.14.
The rally was driven by a joint statement from Geneva, where the United States confirmed a reduction of its combined 145% tariffs on most Chinese imports to 30%, including those related to fentanyl. In return, China agreed to cut its 125% tariffs on U.S. goods to 10%. The easing is set to take effect on May 14.
The prospect of renewed trade flows between the world’s two largest economies lifted global sentiment, with investors optimistic about a rebound in energy demand and industrial activity. Both oil benchmarks had already logged gains of more than 4% last week, marking their first weekly rise since mid-April.
Indian equity markets responded swiftly to the positive global cues. The Nifty Metal index surged up to 5%, with all 15 constituent stocks trading in the green. Meanwhile, the Nifty IT index jumped 5.4%, driven by sharp gains in Infosys, HCLTech, Persistent Systems, Mphasis, Tech Mahindra, and Wipro—some rising as much as 8%.
The announcement follows reports of “substantial progress” in earlier U.S.-China negotiations and marks a key turning point in easing trade tensions that have weighed on global growth and trade volumes.
