Oil Prices Drop as Trump-Putin Summit Creates Market Uncertainty

Post by : Saif Ali Khan

Global oil prices fell slightly on Friday, heading toward a weekly loss, as traders reacted to uncertainty in energy supplies and a major political development: a planned Trump-Putin summit in Hungary to discuss the war in Ukraine.

Oil Market Trends

Brent crude was down 8 cents, or 0.13%, at $60.98 a barrel in early trade, while U.S. West Texas Intermediate (WTI) futures fell 9 cents, or 0.16%, to $57.37 a barrel. On a weekly basis, both benchmarks dropped nearly 3%, signaling a weak week for oil markets.

Analysts attribute part of the decline to the International Energy Agency’s forecast of a growing oil supply surplus in 2026, suggesting that the world may produce more oil than needed next year.

Impact of Trump-Putin Summit

U.S. President Donald Trump and Russian President Vladimir Putin agreed on Thursday to hold another summit within the next two weeks in Budapest. The meeting aims to discuss an end to the war in Ukraine, a development that reduced some market concerns about tighter oil supplies.

Daniel Hynes, an energy analyst at ANZ, said, “Concerns of tighter supplies were eased after it was announced that Trump would be meeting with Putin to discuss ending the war in Ukraine.”

This summit comes amid U.S. pressure on India and China to stop buying Russian oil, as the United States seeks to weaken Moscow’s financial position while supporting Ukraine.

U.S. Oil Supply Data

Adding to the market movement, the U.S. Energy Information Administration (EIA) reported a larger-than-expected increase in crude inventories last week. U.S. crude stockpiles rose by 3.5 million barrels to 423.8 million barrels, compared to analysts’ forecast of just 288,000 barrels.

The inventory rise is partly due to lower refinery activity as refineries begin fall maintenance and turnarounds, reducing the amount of oil processed into fuel. At the same time, U.S. oil production reached a record 13.636 million barrels per day, increasing supply in the market.

Factors Affecting Oil Prices

Oil markets remain sensitive to political and economic news. Prices fell slightly because of:

Global supply concerns easing due to the planned Trump-Putin talks.

Higher U.S. crude inventories than expected.

Record U.S. oil production, which adds more supply to the global market.

Forecasts of a supply surplus in 2026, indicating more oil may be available than needed.

Experts warn that prices could continue to fluctuate depending on:

The outcome of the Trump-Putin summit.

Global demand trends, especially in major oil-consuming countries like the U.S., China, and India.

Geopolitical events affecting Russia or Middle Eastern oil producers.

The oil market faces a mix of political uncertainty and supply factors. While the Trump-Putin summit may ease some fears about supply disruptions, record U.S. production and high inventories continue to put pressure on prices.

Traders and analysts are watching closely, as even small political developments in Ukraine, Russia, or the Middle East can impact oil prices worldwide. For now, the market is in a slightly weaker position, reflecting a combination of geopolitical news and strong U.S. oil supply.

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