Oil benchmarks traded with little net change in Asian trade on Thursday as market participants awaited a meeting later in the day between U.S. President Donald Trump and Chinese President Xi Jinping that could offer fresh signals on the outlook for the Iran conflict.
As of 20:27 ET (00:27 GMT), July Brent futures were up 0.1% at $105.68 per barrel, while West Texas Intermediate futures gained 0.1% to $101.08 per barrel. Both contracts had retreated by more than 1% in the prior session but were nevertheless positioned for significant weekly gains.
Attention centered on the Trump-Xi summit in Beijing, which was due to start later on Thursday. Officials and traders expected the talks to cover a range of topics, including trade tensions, Taiwan and the Iran crisis that has unsettled global energy flows. Market participants were especially alert to any sign that China, the world's largest crude importer, might play a role in de-escalating tensions in the Middle East.
Prices have stayed above the $100-a-barrel mark amid ongoing concerns about potential disruptions in the Strait of Hormuz - a chokepoint through which roughly a fifth of the world's oil supply transits. Those navigation and security risks are a central element of why benchmark crude remains elevated.
International Energy Agency commentary this week flagged the possibility that the global oil market could remain heavily undersupplied through much of 2026, pointing to the consequences of the Iran conflict and reduced exports from the Gulf. Separately, OPEC lowered its 2026 global oil demand growth forecast, attributing the revision to the economic effects of the conflict and sharply higher fuel prices, while leaving its broader economic growth outlook intact.
Mixed diplomatic signals from Washington contributed to market caution. Comments from President Trump earlier in the week that suggested a ceasefire was on "massive life support" tempered hopes for a swift resolution and kept traders on edge.
U.S. government inventory data provided support for prices: crude stockpiles fell by 4.3 million barrels last week, a larger draw than the 2.0 million-barrel decline analysts had anticipated. That larger-than-expected draw was interpreted as evidence of resilient fuel demand despite elevated pump prices.
Context and implications
With prices parked above $100, the market is balancing geopolitical risk, official agency supply assessments and tangible inventory draws. The coming high-level talks between the United States and China are being watched for any concrete indication that tensions around the Iran conflict might ease, a development that could materially affect global crude flows.