09:11 AM EDT, 10/27/2025 (MT Newswires) -- Oil prices were steady early on Monday amid hopes for rising global growth after China and the United States reached a preliminary trade deal ahead of a meeting between U.S. President Donald Trump and China President Xi Jinping. This is offsetting concerns over rising global inventories.

West Texas Intermediate (WTI) crude oil for December delivery was last seen up US$0.01 to US$61.51 per barrel, while December Brent crude was unchanged at US$65.94.

In talks on the fringes of the ASEAN summit in Kuala Lumpur, U.S. and Chinese negotiators reached a deal that sees the end of the threat of U.S. 100% tariffs on imports from China, while China will ease restrictions on its exports of rare earths. The two leaders are expected to discuss the agreement when they meet at the Asia-Pacific Economic Cooperation summit on Thursday.

The potential easing of the trade war between the world's two-largest economies follows on last week's 13% rise in WTI prices after the United States threatened fresh sanctions on Russian oil producers. While Trump's willingness to take a tough stance on Russia to force an end to its war on Ukraine remains in doubt, the measures forced traders selling oil short to cover their positions.

"The surge was partly driven by short covering, after hedge funds as of 21 October had built a record gross short position in Brent." Saxo Bank noted.

Despite optimism for calming tensions amid Trump's global trade wars, any agreement between between China and the United States will come as supply from OPEC+ and its competitors rises well ahead of demand, with both the Energy Information Administration and the International Energy Agency this month predicting global inventories will continue to rise through 2026, pressuring oil prices.