Key Takeaways

• Modest pullback: Brent crude fell 0.4% to $105.18 per barrel, while WTI slipped 0.7% to $100.33.
• Weekly gains intact: Both contracts are still set for sharp weekly gains despite Thursday’s dip.
• Conciliatory summit: Trump-Xi meeting wrapped after 2 hours 15 minutes, with leaders striking a friendly tone despite tensions.
• Xi’s appeal: The Chinese president said stable U.S.-China relations are critical for global stability.
• Trump’s optimism: The U.S. president told Xi the two countries could have a “fantastic future together.”
• Iran question lingers: ING analysts say the market is “eagerly awaiting” whether the summit yields positive Iran outcomes.
• IEA warning: The agency cautions global markets could remain heavily undersupplied through much of 2026 due to the Iran war.
• OPEC cuts demand outlook: The producer group lowered its 2026 global oil demand growth forecast, citing the conflict’s impact.
• Trump’s “life support” hangover: Earlier ceasefire comments continue to dampen hopes for quick resolution.
• U.S. crude stocks plunge: Government data showed a 4.3 million barrel drawdown — more than double the 2.0 million expected.
• Gasoline tight: Gasoline inventories fell 4.1 million barrels, while distillate stocks rose just 190,000 barrels.
• Demand resilient: The inventory drops point to robust fuel demand despite elevated prices.

Oil prices ticked lower during Asian trading on Thursday as U.S. President Donald Trump and Chinese counterpart Xi Jinping struck a conciliatory tone at the Beijing summit, while investors searched for potential clues on the Iran conflict outlook.

As of 02:48 ET (06:48 GMT), Brent oil futures expiring in July fell 0.4% to $105.18 per barrel, while West Texas Intermediate (WTI) crude futures slipped 0.7% to $100.33 per barrel.

Both contracts slipped more than 1% in the previous session, but were still set for sharp weekly gains.

Trump-Xi Meeting in Focus

Markets were laser-focused on the opening day of the two-day Trump-Xi summit, where the leaders projected a conciliatory tone despite simmering tensions over trade, Taiwan, and the Middle East.

Chinese state media reported that the Trump-Xi meeting concluded after 2 hours and 15 minutes, where Xi said stable U.S.-China relations were critical for global stability.

Trump told Xi the two countries could have a “fantastic future together.”

“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,” ING analysts wrote.

Oil prices have remained elevated above $100 a barrel as fears persist over disruptions in the Strait of Hormuz, through which roughly a fifth of global oil supply passes.

IEA Warns of Undersupplied 2026; OPEC Cuts Demand Outlook

The International Energy Agency warned this week that the global market could remain heavily undersupplied through much of 2026 because of the Iran war and lower exports from the Gulf.

OPEC also cut its 2026 global oil demand growth forecast, citing the economic impact of the conflict and sharply higher fuel prices, although it maintained its broader economic growth projections.

At the same time, mixed signals from Washington over possible diplomacy with Tehran kept traders cautious. Trump’s comments earlier this week — suggesting a ceasefire was on “massive life support” — dampened hopes for a quick resolution.

U.S. Inventory Drop Adds Support

U.S. crude inventories also lent support to prices after government data showed stockpiles fell by 4.3 million barrels last week — more than the 2.0 million barrels decline analysts had expected — pointing to resilient fuel demand despite elevated prices.

Gasoline inventories still fell 4.1 million barrels over the week, while distillate stocks rose by just 190,000 barrels.