Oil steadies as markets await outcome of Trump-Xi talks amid Iran war concerns – Firstpost

Oil prices edged higher on Thursday as investors awaited the outcome of ongoing talks between US President Donald Trump and Chinese President Xi Jinping in Beijing, while traders continued to monitor escalating tensions linked to the Iran war and disruptions around the Strait of Hormuz.

Brent crude futures rose 13 cents, or 0.12 per cent, to $105.76 a barrel, while US West Texas Intermediate crude gained 12 cents, or 0.12 per cent, to $101.14 a barrel.

The cautious gains came after both benchmarks fell sharply in the previous session amid concerns that persistent inflation in the United States could keep interest rates elevated for longer and potentially slow global economic growth.

Brent crude had dropped more than $2 a barrel on Wednesday, while WTI fell more than $1 as investors reacted to stronger-than-expected US inflation data and fears that rising oil prices were beginning to spread inflationary pressures across the broader economy.

Trump arrived in Beijing on Wednesday evening for a
two-day summit with Xi, with discussions still underway on Thursday. The meeting is expected to cover trade relations, artificial intelligence, Taiwan, and the ongoing Iran conflict, which has unsettled global energy markets.

The US president is seeking economic wins and attempting to preserve a fragile trade truce with China at a time when surging energy prices and geopolitical tensions are weighing on his domestic approval ratings.

Although Trump has publicly said he does not need China’s help to end the conflict with Iran, analysts believe Washington is likely to press Beijing for support in restoring stability in the region and ensuring the free flow of oil shipments through the Strait of Hormuz.

Iran has meanwhile tightened control over regional energy logistics and reportedly struck agreements with Iraq and Pakistan to facilitate oil and liquefied natural gas shipments despite mounting sanctions pressure from Washington.

China remains the largest buyer of Iranian crude oil, with more than 80 per cent of Iran’s shipped oil exports in 2025 reportedly heading to Chinese refiners, many of which continue to purchase discounted Iranian barrels.

The geopolitical uncertainty has added to broader market concerns over inflation and monetary policy.

On Wall Street, the S&P 500 and Nasdaq Composite closed at record highs on Wednesday as investors piled into technology and artificial intelligence-related shares despite hotter-than-expected inflation data.

Shares of NVIDIA and Tesla gained strongly, helping markets recover from earlier losses.

The latest US producer price index data showed prices rose 1.4 per cent last month, marking the largest monthly increase in four years, largely driven by higher crude prices linked to disruptions around Hormuz.

The report reinforced expectations that the Federal Reserve could maintain restrictive monetary policy for an extended period, with Boston Fed President Susan Collins warning that further rate hikes remain possible if inflation pressures continue.

Investors are now closely watching whether the Trump-Xi meeting can produce progress on trade and geopolitical tensions, particularly as concerns over energy security continue to dominate global markets.