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Oil prices edged lower in Asian trade on Wednesday, taking a breather after a strong four-day rally. The pullback came as investors digested an unexpected increase in U.S. crude inventories and closely monitored President Donald Trump’s visit to the Middle East, which added new geopolitical considerations to global oil supply dynamics.
As of 22:02 ET (02:02 GMT):
- Brent crude futures (June delivery) fell 0.4% to $66.38 per barrel
- West Texas Intermediate (WTI) crude futures dropped 0.4% to $63.01 per barrel
Both benchmarks had surged more than 2.5% on Tuesday, driven by optimism over a deescalation in U.S.-China trade tensions and softer-than-expected inflation data from the U.S.
Tariff Truce Boosts Sentiment, But Inventory Build Weighs
The rally in oil began earlier this week after Washington and Beijing agreed to significantly lower their respective tariffs for 90 days, with the U.S. cutting duties on Chinese imports from 145% to 30%, and China reducing retaliatory tariffs from 125% to 10%. This move helped cool global economic fears and bolstered expectations for stronger crude demand from the world’s top two consumers.
However, market enthusiasm was tempered by an industry report showing a surprise build in U.S. crude stockpiles, suggesting that near-term demand may not be as strong as anticipated. The official inventory figures from the U.S. Energy Information Administration (EIA) are due later Wednesday and could further influence price direction.
Trump’s Saudi Visit Signals Strategic Energy Shifts
Adding to market focus, President Trump’s trip to Saudi Arabia generated headlines after he announced plans to lift longstanding sanctions on Syria. The move could open a path for Syrian crude exports to re-enter the global market, although timelines and implications remain uncertain.
Trump also revealed a $600 billion investment commitment from Saudi Arabia to the U.S., reinforcing Washington’s strategic energy and economic ties with Riyadh.
Meanwhile, the U.S. Treasury imposed fresh sanctions on several companies accused of transporting Iranian oil to China, tightening enforcement just days after nuclear talks between Washington and Tehran concluded in Oman.
Outlook
Despite Wednesday’s dip, crude prices remain near recent highs as traders balance the bullish momentum from easing trade tensions and controlled inflation with bearish signals from rising U.S. inventories and complex geopolitical risks.
Traders now await:
- Official EIA crude stock data
- Further clarity on U.S. policy toward Syria and Iran
- And whether tariff cuts between Washington and Beijing will spur actual demand increases in coming weeks.
Volatility is likely to persist as these variables evolve.
