Oil prices climbed on Wednesday as investor sentiment improved following news that the United States and China will hold high-level trade talks this weekend. The prospect of easing tensions between the world’s two largest economies came alongside forecasts pointing to a decline in U.S. crude inventories.
Brent crude rose 1.76% to $62.98 per barrel, up from $61.89 at the previous close, while the U.S. benchmark, West Texas Intermediate (WTI), edged higher by 0.22% to $58.84 per barrel.
The rally came as markets responded to reports that U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are scheduled to meet their Chinese counterparts in Switzerland. The meetings mark the first formal dialogue since President Donald Trump imposed sweeping tariffs on Chinese goods, escalating the trade conflict.
Bessent is expected to meet with a senior Chinese official on May 8, described by the Treasury Department as China’s lead economic representative. Greer will hold separate discussions on trade matters, according to the U.S. Trade Representative’s Office.
“Economic security is national security, and President Donald J. Trump is leading the way both at home and abroad for a stronger, more prosperous America,” Bessent said in a statement.
Despite the positive momentum, the U.S. Energy Information Administration (EIA) has revised its 2025 oil price outlook downward. The EIA now forecasts Brent crude will average $65.85 per barrel this year, down from an earlier estimate of $67.87. The forecast for WTI was also lowered to $61.81 from $63.88.
The downward revision reflects expectations of rising global inventories. The EIA now estimates that oil stockpiles increased by an average of 300,000 barrels per day in the first four months of 2025—a stark contrast to its January projection of a 200,000 bpd drawdown.
Recent output increases from OPEC+ members have contributed to a supply glut, putting downward pressure on prices and fueling concerns over excess global supply for the rest of the year.
