Oil prices ended nearly 2% higher on Friday, logging their first weekly gain since mid-April as optimism over a new U.S.-UK trade deal and anticipation of U.S.-China trade talks lifted investor sentiment. Brent crude futures rose $1.07, or 1.7%, to settle at $63.91 a barrel, while U.S. West Texas Intermediate (WTI) crude futures gained $1.11, or about 1.9%, to finish at $61.02. Week-over-week, both benchmarks rose more than 4%.
The market drew support after U.S. President Donald Trump announced a deal with the UK that reduced tariffs on British car and steel exports, and then signaled willingness for deeper economic engagement with China, remarking that an 80% tariff on Chinese goods “seems right” compared to the current 145% level. Analysts said the developments revived hopes for similar agreements with Beijing. “Energy markets – as bearish as they’ve been – are finally shaking off some of the pessimism,” said Alex Hodes of brokerage StoneX, adding that the broader market is showing renewed optimism amid trade progress.
Additional support for oil prices came from the geopolitical sphere. Rising hostilities in the Middle East, including a missile launched toward Israel from Yemen, added to the risk premium. This followed a short-lived ceasefire brokered by Oman. Meanwhile, Chinese export data for April came in stronger than expected, offering a degree of economic reassurance ahead of the May 10 talks in Switzerland between U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng.
Still, uncertainty lingers. The trajectory of oil prices remains tied to developments in the U.S. economy, enforcement of sanctions on Iran and Russia, and OPEC+ policy. The group plans to increase oil output in the coming months, but a Reuters survey revealed that OPEC production actually declined slightly in April, due to losses in Libya, Venezuela, and Iraq. That supply dip helped reinforce market optimism heading into a critical weekend of diplomacy and policy signals.