Oil prices rose on Wednesday after U.S. data showed a larger-than-expected draw in crude and fuel inventories, while optimism around trade talks between Presidents Trump and Xi helped lift broader market sentiment. Brent crude gained $0.52(0.8%) to $64.92 a barrel, while U.S. West Texas Intermediate rose $0.33 (0.6%) to $60.48.
The U.S. Energy Information Administration reported that crude inventories fell by nearly 7 million barrels last week, far exceeding expectations for only a modest decline. Gasoline and distillate stocks also posted sizable drawdowns, indicating stronger demand across the fuel complex.
The unexpected drop in inventories prompted traders to reassess expectations of a near-term surplus, despite record U.S. production and rising OPEC+ output. Analysts noted that the data suggested a more balanced market than previously thought.
On the geopolitical front, President Trump struck an optimistic tone ahead of his scheduled meeting with Chinese President Xi Jinping in South Korea on Thursday, saying he expected a “good outcome” from the talks. The two leaders are also expected to discuss ongoing trade disputes and technology restrictions that have dampened global growth and oil demand in recent months.
The positive sentiment from Washington and Beijing helped counter the prior day’s losses, when prices fell nearly 2% on concerns that additional OPEC+ production increases could tip the market back into oversupply.
OPEC+ ministers are preparing to meet in early December, with discussions centering around a potential 137,000 barrel-per-day production increase. The alliance continues to balance efforts to regain market share with the risk of weakening prices amid still-fragile demand conditions.