08:50 AM EDT, 06/11/2025 (MT Newswires) -- Oil traded at a five-week high early on Wednesday after trade negotiations between the United States and China ended with a tentative deal to relax export controls on sensitive goods and technologies.

West Texas Intermediate crude oil for July delivery was last seen up US$1.13 to US$66.11 per barrel, the highest since April 3, while August Brent crude was up US$0.95 to US$67.82.

The rise comes as the United States and China ended two days of talks in London with a framework agreement that will see China relax restrictions on the export of rare earths and magnets, while the United States will ease controls on shipments of some advanced semiconductors to China.

To be sure, both countries are maintaining tariffs on their exports to each other, limiting growth as markets face rising supply and weakening demand as the global economy slows amid the U.S. tariff battles.

"Uncertainty around the tariff impact on demand (recession and stagflation risk) against supply factors (OPEC+ largely) seems to leave energy investors concerned about the downside," National Bank Financial noted.

An unexpected drop in U.S. oil inventories last week supported the price rise. In its weekly survey, the American Petroleum Institute reported oil stocks declined by 0.37-million barrels last week, while the consensus estimate among analysts polled by Oilprice.com expected a rise of 0.7-million barrels. The Energy Information Administration (EIA) will release official storage data later on Wednesday morning.

Still, rising supply continues to check the upside for oil, as OPEC+ continues to speed the return of 2.2-million barrels per day of production cuts with monthly production hikes on 411,000 barrels per day. In its monthly Short-Term Energy Outlook released Tuesday, the EIA said global oil inventories climbed over the first five months of the year. It expects inventories to rise by 0.8-million barrels per day over 2025 and by 0.6-million bpd in 2026.