SINGAPORE – Oil prices saw a marginal increase in Asian trade on Thursday as the market’s focus shifted to a highly anticipated meeting between the leaders of the United States and Russia. This meeting is expected to significantly impact global supply dynamics, injecting a degree of uncertainty into a market that has been nursing a second consecutive week of significant losses.
Brent oil futures for October delivery climbed 0.4% to $65.88 a barrel, while West Texas Intermediate (WTI) crude futures rose 0.3% to $62.13 a barrel by 21:58 ET (01:58 GMT).
The marginal gains occurred as U.S. President Donald Trump and Russian counterpart Vladimir Putin prepared to meet in Alaska on Friday to discuss terms for a ceasefire in Ukraine.
The outcome of the meeting carries high stakes for energy markets. President Trump has threatened “severe consequences” if a peace agreement is not reached, including the possibility of steep tariffs on major buyers of Russian oil, such as India and China. Should these threats materialize and lead to restrictions on Russia’s oil industry, global supplies could be curbed, potentially pushing crude prices higher.
Conversely, reports suggest President Trump may offer several concessions to persuade Russia to reduce its involvement in Kyiv. Any loosening of sanctions on Moscow’s energy industry could further increase global supply, potentially deepening the losses in crude prices.
The modest gains on Thursday come against a strongly bearish backdrop. Oil prices have been pressured by a persistent outlook of cooling demand and bloated supply. Recent forecasts from the U.S. government and the International Energy Agency (IEA) point to “bloated” global oil supplies, with the IEA warning of a looming supply glut in the coming years and predicting a surplus of 3 million barrels per day by 2026.
Bearish sentiment was further solidified by U.S. data released this week, which showed an unexpected 3 million-barrel build in inventories over the past week, significantly overshooting market expectations for a 0.9 million-barrel draw. This inventory data highlights the typical seasonal cooling of demand as the travel-heavy U.S. summer driving season concludes.
