Oil prices stabilized in early trading on Wednesday following a decline over three consecutive sessions. This stabilization comes in the wake of a U.S. trade agreement with Japan, which suggests advancements in tariff negotiations, alongside a poll indicating a reduction in U.S. crude stockpiles last week, reflecting an uptick in demand. Brent crude futures experienced an increase of 33 cents, representing a 0.48% rise, reaching $68.92 per barrel. U.S. West Texas Intermediate crude futures experienced an increase of 33 cents, representing a 0.51% rise, reaching a price of $65.64 per barrel.

President Donald Trump announced on Tuesday that a trade agreement has been reached between the U.S. and Japan, which entails a 15% tariff on imports from Japan to the United States. He also stated that Japan had committed to $550 billion in investments in the U.S. Oil experienced a decline in the prior session following the European Union’s announcement regarding potential countermeasures in response to U.S. tariffs, as optimism diminished for a resolution before the August 1 deadline.

U.S. crude oil stockpiles were anticipated to have decreased in the previous week, alongside distillate and gasoline inventories, according to an extended Reuters poll released on Tuesday. Nine analysts surveyed by Reuters prior to the release of weekly inventory data projected, on average, a decline in crude inventories of approximately 1.6 million barrels for the week ending July 18.

Last week, there was a decline in U.S. crude and gasoline stocks, while distillate inventories experienced an increase, according to market sources referencing figures from the American Petroleum Institute on Tuesday. In a further indication of optimism for the market, the U.S. energy secretary stated on Tuesday that the U.S. would contemplate imposing sanctions on Russian oil to bring an end to the conflict in Ukraine. The European Union on Friday reached a consensus on its 18th sanctions package targeting Russia, which includes a reduction in the price cap for Russian crude oil. However, analysts indicated that insufficient U.S. involvement would impede the efficacy of the package.