Oil extended gains on Tuesday, lifted by hopes of improved economic activity after the U.S.-EU trade deal, a potential U.S.-China tariff truce and President Donald Trump's shorter deadline for Russia to end the Ukraine war.

The Trump administration’s trade deal with China that sharply lowered the tariff rate on Chinese imports is expected to be extended past its Aug. 12 deadline, Treasury Secretary Scott Bessent predicted Tuesday, though he maintained higher tariff rates on other countries’ imports are still slated to take effect Aug. 1 as scheduled.

The trade agreement reached between the U.S. and European Union reaffirms an emerging pattern: higher tariffs, purchase commitments, investment agreements—and a lot of confusion.

They’re talking right now, but the decision-maker, of course, is President Trump,” Lutnick said of the state of negotiations with China.

As the two biggest economic targets in Donald Trump’s trade war, some analysts thought the European Union and China could move closer together and stake out common ground.

President Trump and European Commission President Ursula von der Leyen announced Sunday that the US and EU had agreed to the framework of a trade deal that included a baseline tariff rate of 15% on EU goods imported into the US.

U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng were meeting at the offices of Sweden’s prime minister for two days of talks, which Bessent has said will likely lead to an extension of current tariff levels.

Tariffs on Chinese goods could result in a decline in exports from the Asian manufacturing giant to the U.S. in the years ahead reaching near $500 billion.