Oil prices ease as Trump–Xi summit tempers Iran risk focus

Oil prices slip but stay elevated above $100

As of 02:48 ET (06:48 GMT) on Thursday, Brent Oil Futures for July delivery fell 0.4% to $105.18 per barrel, while West Texas Intermediate (WTI) crude futures declined 0.7% to $100.33 per barrel. Both benchmarks had already dropped more than 1% in the previous session, yet they continued to show sharp gains on a weekly basis.

Prices remained elevated above $100 per barrel, underpinned by persistent fears of supply disruptions in the Strait of Hormuz, a key transit route through which roughly one-fifth of global oil supply passes. The International Energy Agency (IEA) warned this week that the global oil market could stay heavily undersupplied through much of 2026, citing the impact of the Iran war and reduced exports from the Gulf.

Trump–Xi summit and Iran conflict shape market sentiment

Market attention was centered on the opening day of the two-day summit between Trump and Xi in Beijing. According to Chinese state media, the meeting lasted 2 hours and 15 minutes, with Xi stating that stable U.S.–China relations were critical for global stability. Trump said the two countries could have a “fantastic future together.”

Analysts at ING noted that “the oil market is eagerly awaiting the outcome of the meeting between President Trump and President Xi, and whether it could yield some positive results on the Iran war.” At the same time, mixed signals from Washington over possible diplomacy with Tehran kept traders cautious. Trump’s recent comment that a ceasefire was on “massive life support” dampened expectations for a swift resolution to the conflict.

OPEC reduced its 2026 global oil demand growth forecast, pointing to the economic fallout from the conflict and sharply higher fuel prices, though it left its broader economic growth outlook unchanged.

U.S. inventory data underline resilient fuel demand

U.S. crude inventories provided additional support to prices. Government data showed stockpiles fell by 4.3 million barrels last week, exceeding expectations for a 2.0 million-barrel decline, indicating resilient fuel demand despite elevated prices.

Gasoline inventories dropped by 4.1 million barrels over the week, while distillate stocks increased only modestly, by 190,000 barrels. These figures reinforced concerns about tight supply conditions in refined products even as headline crude prices slipped on the day.

FAQ

What are current Brent and WTI prices mentioned in the report?
Brent Oil Futures for July were trading at $105.18 per barrel, down 0.4%, while WTI crude futures stood at $100.33 per barrel, down 0.7%, as of 02:48 ET (06:48 GMT) on Thursday.

Why are oil prices still elevated above $100 per barrel?
Prices remain elevated due to fears of supply disruptions in the Strait of Hormuz, the impact of the Iran war on global supply, and lower exports from the Gulf, alongside signs of resilient demand in the United States.

What did the IEA and OPEC say about the market outlook?
The IEA warned that the global oil market could remain heavily undersupplied through much of 2026 because of the Iran war and reduced Gulf exports. OPEC cut its 2026 global oil demand growth forecast, citing the conflict’s economic impact and higher fuel prices, while keeping broader economic growth projections unchanged.

How did U.S. inventories change last week?
U.S. crude stockpiles fell by 4.3 million barrels, more than the expected decline of 2.0 million barrels. Gasoline inventories dropped by 4.1 million barrels, and distillate stocks rose by 190,000 barrels.