Oil Markets Steady as US-China Trade Talks Fuel Optimism

London, June 9, 2025 — Oil prices remained stable on Monday as investors pinned hopes on U.S.-China trade talks in London, anticipating that a potential deal could bolster the global economy and drive oil demand. Brent crude futures rose 39 cents, or 0.59%, to $66.86 per barrel by 1205 GMT, while U.S. West Texas Intermediate (WTI) crude gained 36 cents, or 0.56%, to $64.94. Last week’s gains, with Brent up 4% and WTI up 6.2%, reflected growing market optimism about a possible resolution to trade tensions. However, concerns over China’s slowing crude imports and increased OPEC+ output next month tempered the bullish sentiment.

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Trade Talks and Economic Outlook

The upcoming U.S.-China trade discussions aim to ease bilateral tensions that have disrupted global markets, following a Thursday call between U.S. President Trump and Chinese leader Xi Jinping. A successful deal could enhance economic growth prospects, boosting demand for commodities like oil.

Tony Sycamore, an analyst at IG Markets, noted that the talks could overshadow recent Chinese economic data, which showed export growth slowing to a three-month low in May due to U.S. tariffs and deepening factory gate deflation. These factors have strained China’s economy, the world’s second-largest, impacting global oil demand.

Did you know?
China, the world’s largest crude oil importer, consumed an average of 14.3 million barrels per day in 2024, accounting for nearly 14% of global oil demand.

China’s Crude Imports and Market Pressures

China’s crude oil imports fell to a four-month low in May, driven by planned maintenance at state-owned and independent refineries. This decline, coupled with U.S. tariffs curbing Chinese exports, has added pressure on oil prices. WTI, which had been testing resistance levels near $65, faced challenges breaking higher due to these headwinds. Despite this, the prospect of a U.S.-China trade agreement has kept markets buoyant, outweighing concerns about increased production from the OPEC+ group, which is set to ramp up output next month.

Global Factors Influencing Oil Prices

Oil prices are sensitive to both geopolitical developments and economic indicators. The potential for a U.S.-China trade deal has bolstered investor risk appetite, supporting crude prices. However, global supply dynamics, including OPEC+’s planned output increase, could cap gains.

Additionally, upcoming U.S. economic data, such as the Consumer Price Index due on Wednesday, may influence expectations for Federal Reserve interest rate decisions, which could further affect oil demand by impacting economic growth projections.