Another tariff u-turn: Oil overbought on news?

President Trump announced a 90-day pause on reciprocal tariffs for countries that have not retaliated, sparking a sharp rally in U.S. markets. The Nasdaq 100 led gains with a 12.2% surge. The U.S. dollar also strengthened against safe-haven currencies such as the Japanese yen and Swiss franc.

Crude oil prices rebounded alongside equities, with oil futures rising more than 4% to trade above $62 per barrel.

However, the strength of the oil rally may be overstated. China, one of the world’s largest oil consumers, was among the first to retaliate against U.S. tariffs. Tensions between Washington and Beijing have worsened, prompting the U.S. to raise tariffs on Chinese goods to 125%.

Adding to the caution, analysts at Goldman Sachs revised down their 2026 average price forecasts for Brent and WTI, citing rising recession risks. The bank now expects Brent to average $58 per barrel and WTI to average $55.