Oil prices are rising with support from the extension of the trade deadline between the United States and the European Union.

Oil prices witnessed a significant increase during trading on Monday, May 26, supported by the decision of U.S. President Donald Trump to extend the deadline for trade negotiations with the European Union, easing investors' concerns about new tariffs that could weaken the global economy and oil demand.

Brent crude futures rose by 26 cents (0.4%) to reach $65.04 per barrel, while West Texas Intermediate crude rose by 25 cents (0.41%) to reach $61.78 per barrel.

Tony Sycamore, market analyst at "IG," explained to Reuters: "We saw a good rise in crude oil prices and U.S. futures this morning after President Trump extended the deadline."

The decision to extend negotiations until July 9 came after a request from European Commission President Ursula von der Leyen, who emphasized the need for more time for the Union to reach an agreement.

Decreased concerns about the return of Iranian oil to global markets, due to limited progress in U.S.-Iranian nuclear talks, also supported prices.

Additionally, American buyers covering their positions ahead of the three-day "Memorial Day" holiday boosted demand.

On the other hand, data from "Baker Hughes" showed a decrease in the number of active oil drilling rigs in the United States by eight rigs last week, bringing the total to 465 rigs, the lowest since November 2021.

The "OPEC+" alliance is set to hold its meetings next week, with expectations of a new production increase of 411,000 barrels per day for July.

The alliance is also expected to end the remaining voluntary cuts of 2.2 million barrels per day by October, after previously raising its production by one million barrels per day during the months of April, May, and June.

Sycamore concluded by saying: "Trade and tariff headlines, along with financial concerns, will remain pivotal factors in oil price movements this week."