LONDON, Feb 10 (Reuters): Oil prices rebounded on Monday despite lingering fears over a potential global trade war after US President Donald Trump's latest tariff plans, this time targeting steel and aluminium.
Brent crude futures were up $1.05, or 1.4 per cent, at $75.71 a barrel by 1301 GMT. US West Texas Intermediate crude added 1.5 per cent, also rising $1.05 to $72.05.
Monday's gains could be down to bargain hunting after the market posted a third consecutive weekly decline last week, pressured by the concerns over global trade.
"It's tariff uncertainty which is the name of the game. This affects risk appetite in general and has spillover effects into oil," said Harry Tchilinguiran at Onyx Capital. "After last week's declines, some people may be buying into the dip."
Trump said he will announce on Monday 25 per cent tariffs on all steel and aluminium imports into the United States. A week ago he announced tariffs on Canada, Mexico and China, but suspended those for the neighbouring countries the next day.
There are concerns that tariffs could dampen global economic growth and energy demand. But in light of Trump's temporary backdown last week, investors appeared to be shrugging off the steel and aluminium tariff threat for now, said IG analyst Tony Sycamore.
"The market has realised tariff headlines are likely to continue in the weeks and months ahead," he said, adding that there was an equal chance they could be walked back or even increased at some point in the near future.
Shares in oil major BP rose by 7 per cent to their highest since August in early trade on Monday.
"So perhaps investors are coming to the conclusion it's not the best course of action to react negatively to every headline."
China's retaliatory tariffs on some US exports are due to take effect on Monday, with no sign yet of progress in talks between Beijing and Washington.
