US-EU trade deal announced
July 28, 2025
The European Union and the US have agreed to a trade deal that would impose 15% tariffs on each other’s goods. This has made the markets optimistic this morning and as a result the energy markets are higher. The agreement also includes a commitment of EU investment in the US, as well as the purchase of US energy.
The OPEC+ panel meets today to determine how the markets have performed and to lay out a recommendation for what they should do at the August meeting. The market’s outlook is that OPEC+ will bring the remaining 546,000 barrels per day back to the market when it meets in August. This is part of the reason the outlook is for more barrels and a surplus later this year. But OPEC+ will need to show proof of these additional barrels.
There is currently a positive economic outlook as the EU and US announce a trade deal and it is front and center in the news headlines, but the market still has the outlook that later this year there will be an oversupplied market. This thought that supplies will be abundant later this year are likely to keep prices hemmed in barring some major change or event. This points to a market that continues to trade sideways and is stuck in a range.
Baker Hughes reported that oil rigs fell by 7 to a total of 415 and last year there were 482 oil rigs in operation.
President Trump announced a reduction in the 50-day deadline for Russia to reach a truce with Ukraine, expressing disappointment over the progress. He and his cabinet have signaled that the next phase of pressure on Russia will include imposing 100% “secondary tariffs” on any country that continues to buy Russian oil and gas, particularly targeting India and China, both of which have benefited from discounted Russian energy since 2022.