Oil prices gained more than 3% on Tuesday as President Donald Trump ramped up pressure on Russia over its war in Ukraine and on optimism that a trade war between the U.S. and its major trading partners was abating.

Brent crude futures settled $2.47, or 3.53%, higher at $72.51 a barrel while U.S. West Texas Intermediate crude gained $2.50, or 3.75%, to settle at $69.21. Both contracts settled at their highest since June 20.

On Tuesday, Trump said he would start imposing tariffs and other measures on Russia "10 days from today" if Moscow did not make progress toward ending the war in Ukraine.

"We've amped it up. We have a hard deadline of 10 days," said Phil Flynn, senior analyst with Price Futures Group. "And there's a suggestion that other countries are going to join us."

Also on Tuesday, U.S. Treasury Secretary Scott Bessent said he had told Chinese officials that, given U.S. secondary tariff legislation on sanctioned Russian oil, China could face high tariffs if Beijing continued its Russian oil purchases.

Bessent was speaking after two days of bilateral talks aimed at resolving longstanding economic disputes and stepping back from an escalating trade war between the world's two biggest economies.

Also supporting oil prices, the trade agreement between the U.S. and the European Union, while imposing a 15% import tariff on most EU goods, sidestepped a full-blown trade war between the two major allies that would have rippled across nearly a third of global trade and dimmed the outlook for fuel demand.

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"There is definitely some optimism around the trade deals," said Bob Yawger, director of energy futures at Mizuho. "It's not perfect, especially for the Europeans, but it is better than it could have been by a long shot."

The agreement also calls for $750 billion of EU purchases of U.S. energy over the next three years, which analysts say the bloc has virtually no chance of meeting, while European companies are to invest $600 billion in the U.S. over Trump's term.

Source: Investing.com