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Monday 10 November 2025
Trump Reaffirms Trade War with China; Oil Gains Ground
After a volatile start to the week, markets are quietly digesting the latest comments from U.S.President Donald Trump on trade relations between the U.S.and China. Oil prices lifted as much as 1% on Thursday morning, 16 October, after Trump said Indian Prime Minister Narendra Modi has agreed to stop buying Russian oil.
US equity indices sharply retreated at the end of last week in response to the U.S.President threatening 100% tariffs on China, only to rebound on Monday when he softened his stance over the weekend. The increased tariff uncertainty is a risk-factor for stock markets, which remain near record highs. (Source: Yahoo Finance)
TL;DR
US President Trump confirmed the U.S. and China are in a trade war, reigniting tensions.
Oil rose 1% after Trump said India may stop buying Russian crude.
The IEA warned of a possible 4 million bpd oil surplus next year.
Markets remain steady as investors await Trump-Xi talks at APEC.
Trump Confirms China Trade War
On Wednesday, 15 October, President Trump answered a journalist’s question about a U.S.-China trade war, saying, “Well, you’re in one now.”
The President appeared to be ‘saying out loud’ what some market participants fear could be a major geopolitical headwind looking forward. His comments were partly offset by more calming words from Treasury Secretary Scott Bessent, who left the door open to an extension of the tariff pause with China ,with Trump still set to meet Chinese President Xi Jinping this month.
European markets were slightly lower while U.S.futures were little changed on Thursday morning in a muted reaction to the latest salvo in the trade war. The major U.S.stock averages closed mixed on Wednesday, with the S&P 500 and Nasdaq gaining ground by 0.4% and 0.7% respectively, while the Dow Jones closed essentially flat. (Source: CNBC)
India to Stop Buying Russian Oil?
The chances that India will stop its purchases of Russian oil, one of the primary sources of funding for the country’s war with Ukraine, appeared to improve in the last 24 hours.
President Trump told journalists he had been assured by Prime Minister Modi that India would halt its purchases shortly - a move that would go counter to all public statements by the country to date. Modi has maintained for months that India remains neutral in the Russia-Ukraine conflict.
The potential removal of some Russian oil supply from the market could act to shore up global oil benchmark prices, which currently hit a 5-month low this week.
The increased trade tensions as well as forecasts for an oil supply surplus in 2026, have weighed on global growth expectations, pushing down oil prices. On Tuesday, the IEA (International Energy Agency) warned that the global oil market could see a surplus of as much as 4 million barrels per day next year, a larger excess than it previously projected. (Source: Investing.com)
Latest Tariffs News - Key Points
Temporary truce:
A 90-day tariff pause remains in place until 10 November, with a possible extension if progress is made at APEC later this month.
China retaliates:
Beijing sanctioned five US-linked Hanwha units and introduced port fees on U.S.vessels; the U.S. responded in kind.
Economic warnings:
The IMF says renewed tariffs could slow global growth; Goldman Sachs estimates Americans will pay over half of Trump’s tariffs via higher prices.
Corporate fallout:
Apple (AAPL) to increase investment in China despite tariff risks.
Stellantis (STLA) unveils $13bn U.S.investment to offset higher import costs.
Dollar Tree (DLTR) warns tariffs remain a drag on profits.
Ericsson's (ERIC) shares popped after it beat on earnings, shrugging off U.S.tariffs.
Conclusion
Markets appear to be taking the latest trade war rhetoric in stride, for now. Despite Trump’s confirmation of renewed tensions with China, investors seem reassured by the prospect of continued dialogue and possible tariff extensions. Still, the mix of escalating tariffs, oil dynamics, and fragile global growth leaves risk sentiment finely balanced heading into the APEC summit later this month.
*Past performance does not indicate future results. The above are only projections and should not be taken as investment advice.
FAQs
What did President Trump say about the US-China trade war?
President Trump confirmed the existence of a trade war between the U.S. and China during a press briefing on October 15, stating, “Well, you’re in one now.” This marked a formal acknowledgment of rising tensions and unsettled markets already wary of increased tariffs.
Why are markets reacting to these comments?
Markets are sensitive to trade tensions because tariffs can impact global growth, corporate profits, and consumer prices. Initially, equities dropped on fears of new tariffs, but later rebounded when the President softened his stance and the Treasury hinted at continued talks.
What is the current status of U.S. tariffs on China?
A 90-day tariff truce remains in place, set to expire on 10 November. There is a possibility of an extension, depending on the outcome of the anticipated Trump–Xi meeting at the APEC summit later this month.
What’s happening with oil prices?
Oil rose up to 1% on 16 October after President Trump claimed that Indian PM Modi agreed to stop buying Russian oil. This could reduce global supply and support prices. However, the IEA warns of a 4 million barrels/day surplus in 2026, which could weigh on long-term prices.
Is India really stopping Russian oil imports?
So far, India has publicly maintained neutrality in the Russia-Ukraine conflict and continued buying Russian oil. Trump’s comment suggests a possible change, but this hasn’t been confirmed by Indian officials. Markets are watching closely.
How are financial markets responding overall?
Despite initial volatility, U.S. equity markets remain near record highs. Investors appear to be cautiously optimistic, focusing on potential dialogue and the possibility of a renewed truce at the upcoming APEC summit.
