Oil Rally Faces Doubts Despite Market Surge on Trump’s Tariff Pause

A surprise announcement from President Donald Trump that tariffs would be suspended for 90 days on nations not retaliating against U.S. trade measures sparked a powerful rally across American markets. The Nasdaq 100 jumped 12.2% in a single session, while the dollar strengthened against traditional safe-haven currencies such as the yen and Swiss franc.

Oil Joins the Risk-On Surge

Crude oil followed the broader risk rally, with WTI futures climbing more than 4% to trade above $62 per barrel. The move was driven by hopes that easing trade tensions might bolster global demand, particularly in energy markets.

Rally May Be Overstretched

Still, analysts caution that the bullish move in oil may be running ahead of fundamentals. China—one of the world’s largest energy consumers—was among the first to retaliate against U.S. tariffs, escalating tensions that remain unresolved. In fact, Washington has already responded with higher tariffs on Chinese goods, raising the rate to 125%. This intensifying conflict casts doubt on whether demand can recover strongly enough to justify the recent surge in crude.

Outlook

Market watchers suggest that unless there is genuine de-escalation between Washington and Beijing, oil prices could struggle to hold above current levels. A pullback toward $60 remains possible if geopolitical risks overshadow the short-term boost from Trump’s tariff pause.