WTI slips to $96.70 as markets await Trump Xi summit

West Texas Intermediate (WTI), the US crude oil benchmark, traded around $96.70 during early European trading hours on Thursday as investors turned cautious ahead of a high-level meeting between US President Donald Trump and Chinese President Xi Jinping in Beijing.

Oil prices edged lower as traders awaited the outcome of the two-day summit scheduled for Thursday and Friday.

Market participants closely monitored the talks for any signals on trade relations, geopolitical developments, and the broader outlook for global energy markets.

Trump-Xi summit in focus

According to Xinhua News Agency, Xi Jinping told a group of US chief executives accompanying Trump during the Beijing visit that China’s economy would continue opening up to foreign businesses.

Xi reportedly stated that China’s “door would only open wider” and added that US companies would have more opportunities in the country.

The remarks came as markets looked for signs of improving economic and diplomatic ties between the world’s two largest economies.

Traders believe any positive developments from the summit could weigh on crude prices in the near term by easing geopolitical uncertainty and improving market sentiment.

Iran and Strait of Hormuz discussions add to market attention

In addition to trade discussions, Trump is expected to urge Xi to pressure Tehran into agreeing to a peace deal and reopening the Strait of Hormuz, a strategically important passage for global oil shipments.

The Strait of Hormuz remains a critical chokepoint for international crude trade, and any disruption in the region has the potential to significantly impact global energy markets.

The meeting between Trump and Xi comes only two days after the US president criticised Iran’s response to a US proposal, calling it unsatisfactory.

Trump also warned that the ongoing ceasefire was “on life support” and threatened to restart bombing operations against the country.

These developments have kept geopolitical tensions elevated, although investors appeared to focus more on the possibility of diplomatic progress during the US-China talks.

Analysts suggested that any easing in tensions surrounding Iran or improvements in negotiations between Washington and Beijing could place downward pressure on WTI prices in the short term.

IEA warns of sharp supply deficit

Despite the decline in oil prices on Thursday, concerns over tightening global supply continued to support the broader market outlook.

The International Energy Agency (IEA) stated on Wednesday that global oil supply would fail to meet total demand this year as the Iran war disrupts Middle East oil production and rapidly depletes inventories.

The agency projected that global oil supply could decline by approximately 3.9 million barrels per day (bpd) during 2026 because of the conflict.

The latest estimate marked a significant revision from the IEA’s earlier forecast, which had predicted a decline of around 1.5 million bpd.

The revised outlook highlighted growing concerns over the impact of geopolitical instability on global energy supplies, particularly as disruptions in the Middle East continue to intensify.