Market risk appetite picks up, oil prices continue to strengthen, and short-term fluctuations upward

Crude oil prices climbed slightly as market participants expected positive results from the negotiations between the Asian giant and the United States. Brent crude futures rose $0.12 to $67.16 per barrel during the Asian session on Tuesday, and U.S. WTI crude rose $0.13 to $65.42, hitting a new high since April 4.

Brent rose to $67.19 in the previous trading day, the highest point since April 28, mainly benefiting from market expectations that the United States and China may reach an agreement.

"If a comprehensive trade solution is reached, it will significantly improve the global economic outlook and enhance demand for commodities including crude oil," an analyst pointed out.

Negotiations between the Asian giant and the United States entered their second day in London, with the focus ranging from tariffs to supply restrictions on key materials. The current consultations are seen as a key window to ease the risks of global supply chain tensions and slowing economic growth. According to market surveys, the U.S. President said the negotiations were "progressing well" and said "all the news received from the team is positive."

The market generally expects that if an agreement is reached, it will help curb trade concerns and drive growth in crude oil demand.

In the Middle East, Iran announced that it will submit a counter-proposal to the nuclear agreement in response to the conditions previously proposed by the United States but considered "unacceptable" by it. The two sides are still in clear disagreement on whether to allow Iran to continue to enrich uranium on its own soil.

As the third largest oil producer in OPEC, if the United States relaxes sanctions on Iran, its crude oil exports may resume, thereby increasing global supply and suppressing the rebound space of oil prices.

OPEC supply data has also attracted market attention. According to market surveys, OPEC's overall production increased in May, but the increase was limited. Among them, Iraq has limited its current output to make up for the previous overproduction, while Saudi Arabia and the UAE have only increased production slightly and have not fully used their quotas.

The OPEC+ alliance (including non-OPEC oil producers such as Russia) is accelerating its withdrawal from the previous production cut agreement. This strategic shift may lead to an imbalance between market supply and demand.

Daniel Hynes, senior commodity strategist at ANZ, said: "If OPEC eventually shifts to a completely market-driven supply strategy, the crude oil market will be in a large surplus in the second half of 2025, and oil prices will almost certainly fall."

From a technical perspective, the daily chart of US crude oil (WTI) shows that after breaking through the upper edge of the range of fluctuations since mid-April, the price continues to run above $65, showing a mild upward channel in the short term.

The current price is above the 20-day and 50-day moving averages, indicating that bullish sentiment is dominant. The MACD indicator remains above the zero axis, and the red column begins to appear, suggesting that momentum is increasing. If it can continue to stand at $65, the next resistance level will point to the early April high of $66.80. On the contrary, if the price falls below $64.20, it will return to the consolidation pattern and face the test of the 20-day moving average support.