Trump heads to Gulf as markets surge on US-China tariff deal
China and the United States said on Monday they agreed on a deal to cut reciprocal tariffs by 110% from May 14 as they seek to end the trade war that has upended global markets.
Gulf markets rose Monday after China and the United States agreed to temporarily lower tariff levels, boosting oil prices ahead of US President Donald Trump’s visit to the region this week.
What happened: On Monday, China and the United States announced a 90-day agreement to reduce reciprocal tariffs starting May 14 as they seek to end a trade war that has upended the global economy and caused volatility in international financial markets.
Last month, Trump imposed tariffs of up to 145% on Chinese imports. Beijing responded with duties of 125% on select American goods. Under the new deal, US Treasury Secretary Scott Bessent said Washington will lower tariffs on Chinese goods to 30% for 90 days, while China will reduce its tariffs on US imports to 10% over the same period.
Why it matters: Oil is the Gulf’s main source of income and has significant sway on regional markets. In the lead-up to this weekend's talks, prices climbed on optimism that a US-China tariff deal would ease global economic tensions and reduce the risk of a recession.
