Crude oil markets saw modest gains Thursday as traders looked ahead to a crucial diplomatic meeting between U.S. President Donald Trump and Chinese President Xi Jinping scheduled for later in the day, with ongoing tensions over the Iran conflict weighing on investor sentiment.
Brent crude futures climbed 13 cents, representing a 0.12% increase to reach $105.76 per barrel at 0015 GMT, while U.S. West Texas Intermediate futures gained 12 cents, also up 0.12%, to trade at $101.14.
The Thursday gains followed significant declines the previous day when both major oil benchmark contracts dropped amid investor concerns over potential U.S. interest rate increases. Brent crude futures tumbled more than $2 per barrel on Wednesday, while WTI futures decreased by over $1.
The U.S. president arrived in Beijing Wednesday evening and is scheduled for multiple discussions with Xi, seeking to achieve economic victories, preserve a delicate trade agreement, and address challenging topics including the Iran war and arms sales to Taiwan.
Although Trump has indicated he doesn’t believe Chinese assistance is necessary to conclude the Iran conflict, the president is still anticipated to request Xi’s help in ending the expensive and unpopular war. However, market experts believe he’s unlikely to receive the backing he seeks.
“Failure to make meaningful progress on reopening the strait could leave the US with few options other than renewed military action,” IG analyst Tony Sycamore said in a note.
Iran has apparently strengthened its grip on the Strait of Hormuz, establishing agreements with Iraq and Pakistan for shipping oil and liquefied natural gas from the area.
China remains Iran’s largest oil purchaser despite sanctions pressure from the Trump administration.
Over 80% of Iran’s exported oil headed to China in 2025, with Chinese independent refiners capitalizing on discounted U.S.-sanctioned crude.
