Oil prices extended gains Monday as a new trade agreement between the US and the EU eased supply concerns, while uncertainty over the Federal Reserve's (Fed) interest rate outlook kept investors cautious.
The international benchmark Brent crude rose around 0.85% to $68.17 per barrel at 10.07 a.m. local time (0707 GMT), up from $67.59 at the previous session's close.
The US benchmark West Texas Intermediate (WTI) crude increased by 0.91% to $65.41 per barrel, compared to $64.82 in the prior session.
The US and the EU on Sunday reached a trade deal, ending months-long uncertainty, President Donald Trump announced following a meeting with European Commission President Ursula von der Leyen in Scotland.
"I think it's great that we made a deal today, instead of playing games," Trump told reporters, along with von der Leyen, following talks at his golf resort in Turnberry.
The US president said he thinks the deal is going to be "great" for both parties, which sets the US rate at 15% on EU goods.
Earlier, Washington had threatened a tariff rate of 30%.
As part of the deal, the EU will invest $600 billion in the US, while the bloc will purchase $750 billion in US energy and military equipment.
"Energy is a very important component," Trump said during the joint news conference.
For her part, the European Commission president also praised the deal, saying: "We have a deal; we have a trade deal between the two largest economies in the world, and it's a big deal."
Analysts say the deal could spur economic activity and drive up energy demand, adding upward pressure on oil prices.
Investors are also waiting for the third round of US-China trade talks, led by US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, taking place in the Swedish capital through July 30.
Meanwhile, investors are watching the Fed's upcoming interest rate decision, with analysts expecting the central bank to hold rates steady as it assesses the impact of trade tariffs on inflation.
Upcoming non-farm payroll and economic growth data are expected to offer clearer signals on the direction of the US economy. Meanwhile, investors are looking to next month's Jackson Hole Economic Policy Symposium for more guidance from Fed officials on the future path of monetary policy.
Low interest rates are expected to weigh on the dollar, which could boost oil demand and add upward pressure on prices.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr