On Wednesday, WTI crude oil futures edged closer to $66 per barrel after experiencing a three-day downturn. This increase was propelled by advancements in US trade discussions that bolstered optimism regarding the demand outlook. Recently announced trade agreements among major global economies have raised expectations for more comprehensive deals with key US trading partners—especially principal crude oil consumers—prior to the August 1 deadline. This development has alleviated some concerns about the potential impact of extended trade conflicts on energy demand.
Furthermore, US Treasury Secretary Scott Bessent announced upcoming meetings with Chinese officials next week, which are expected to postpone the August 12 trade deadline. The discussions may cover a range of topics, including China's ongoing procurement of oil from Russia and Iran, despite sanctions. Adding to the market's support, US crude oil inventories declined by 0.6 million barrels last week, breaking a pattern of three consecutive weeks of inventory increases, although there was a rise in distillate stockpiles. Market participants are now focusing on official inventory reports set to be released later today.
