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Oil prices advanced for a second consecutive session on Wednesday, supported by optimism surrounding potential progress in U.S. trade negotiations with China and India and signs of tightening supply.
By 12:11 GMT, Brent crude futures were up 1.9% to $62.50 a barrel, while U.S. West Texas Intermediate (WTI) gained 2% to $58.41, extending Tuesday’s rebound after hitting multi-month lows earlier this week.
Trade Developments Boost Sentiment
Energy markets were buoyed after U.S. President Donald Trump revealed that he had spoken with Indian Prime Minister Narendra Modi, who pledged to limit India’s purchases of Russian oil. The commitment added to speculation of closer U.S.–India trade ties.
India’s Mint newspaper reported that the two nations were nearing a long-delayed trade deal that would slash U.S. tariffs on Indian imports from 50% to 15–16%, potentially stimulating global demand and bolstering sentiment across commodity markets.
Meanwhile, U.S. and Chinese officials are set to meet this week in Malaysia to revive discussions aimed at resolving the ongoing trade dispute. Trump said on Monday that he expected a “fair trade deal” with Chinese President Xi Jinping at their planned meeting in South Korea next week, though he later cast doubt on whether the talks would occur as scheduled.
Supply Risks Support Prices
Supply concerns also lent support to oil markets after reports that the planned summit between Trump and Russian President Vladimir Putin was postponed, clouding the outlook for coordinated geopolitical progress.
Additionally, Western pressure on Asian buyers to reduce Russian oil imports has raised fears of supply disruptions, further underpinning crude prices.
Market participants were also encouraged by signs of falling U.S. oil inventories. According to the American Petroleum Institute (API), crude, gasoline, and distillate stocks declined last week. Official data from the Energy Information Administration (EIA) is expected to confirm similar trends later this week.
Strategic Reserves and Market Balance
In a separate development, the U.S. Department of Energy announced plans to purchase 1 million barrels of crude for the Strategic Petroleum Reserve (SPR), citing current low prices as an opportunity to rebuild depleted stockpiles.
Analysts noted that while global demand remains uncertain amid the prolonged trade dispute, the combination of potential supply tightening and improved trade sentiment could provide a short-term floor for oil prices, with Brent likely to find near-term support around $61 per barrel.
