US President Trump and Italian Prime Minister Meloni expressed optimism about easing trade tensions between the US and Europe. Trump stated that "reaching an agreement with Europe or anyone else will not be a big problem," implying that both sides are expected to reach a consensus on tariffs and trade disputes, providing a positive signal for the global market.

Bob Yawger, head of energy futures at Mizuho Bank, pointed out that the expectation of reaching an agreement with the European Union is expected to limit the demand disruption caused by Trump's tariffs, thereby improving market risk appetite.

At the same time, the US government has imposed new sanctions on Iran's oil exports, aimed at curbing Iran's crude oil supply. The new sanctions measures target key links in the US's imports of Iranian oil, increasing market expectations of tight crude oil supply. This move has to some extent increased the uncertainty of global supply, driving up oil prices further.

OPEC revealed in its latest report that countries such as Iraq and Kazakhstan have submitted further production reduction plans aimed at making up for the supply surplus caused by exceeding quotas in the past.

Although such measures have often been difficult to fully implement in history, the market generally believes that OPEC+countries can to some extent curb the situation of oversupply in the market by regulating production, providing technical support for oil prices.

Despite the recent rebound in oil prices due to trade agreement hopes and new sanctions news, with an overall increase of about 5% this week, at the same time, multiple institutions (including Goldman Sachs, JPMorgan Chase, UBS, etc.) have lowered their forecasts for oil prices and demand growth.

The reason is that the US tariff policy and retaliatory measures by various countries have led to uncertain global trade prospects, which may trigger a slowdown in economic growth and reduce energy demand. The International Energy Agency (IEA) warns that the risk of global oversupply will continue in the coming years.

From a technical perspective, we are still in the oversold rebound range. Before there is a clear reversal signal, we should be cautious of a second pullback and observe whether the short-term intensive pressure range around $65 is blocked from falling.

Editor's viewpoint:

The current oil market has shown signs of short-term recovery, mainly supported by the hope of a trade agreement and the implementation of new US sanctions on Iran. However, the uncertainty of global economic growth and a series of trade conflicts still plague the market, and multiple institutions have lowered their future demand expectations, indicating that the market's fundamentals remain pessimistic. Pay close attention to the follow-up reports of OPEC+and IEA.