Oil prices declined on Tuesday due to concerns about oversupply and weakening demand driven by rising tensions between the United States and China — the world’s two largest oil consumers — even as U.S. President Donald Trump expressed optimism about reaching a trade deal.
Brent crude futures slipped by 14 cents, or 0.2%, to $60.87 a barrel at 0005 GMT. The U.S. West Texas Intermediate (WTI) crude contract for November delivery, set to expire Tuesday, eased 0.1% to $57.45 per barrel, while the more active December contract dropped 13 cents, or 0.2%, to $56.89.
President Trump said on Monday he expected to reach a “fair and strong” trade agreement with Chinese President Xi Jinping, despite ongoing disputes over tariffs, technology, and market access ahead of their planned meeting in South Korea next week. “I think we’ll end up with a very strong trade deal. Both of us will be happy,” Trump stated.
Energy consultancy Ritterbusch and Associates noted that crude’s near-term trading outlook remains bearish, suggesting investors are favoring selling during price rallies rather than buying on dips. However, the firm added that ongoing geopolitical uncertainty may occasionally counterbalance the increasingly negative oil supply-demand dynamics.
A preliminary Reuters poll indicated that U.S. crude stockpiles likely rose last week, ahead of inventory reports from the American Petroleum Institute (API) and the Energy Information Administration (EIA).
In Russia, operations at the Rosneft-controlled Novokuibyshevsk refinery in the Volga region were halted after a drone attack on Sunday. Meanwhile, a strike on the Orenburg gas plant prompted neighboring Kazakhstan to reduce production at its Karachaganak oil and gas condensate field by 25% to 30%.
Uncertainty surrounding Russian oil supplies persists, as President Trump warned that India could face “massive tariffs” if it continues importing Russian crude. India has become the largest buyer of discounted Russian oil since Western sanctions were imposed on Moscow.
Adding to the downward pressure, the International Energy Agency (IEA) recently projected that the global oil market could experience a surplus of nearly 4 million barrels per day by 2026, as OPEC+ members and non-OPEC producers increase output amid sluggish demand growth.
