Oil set for weekly loss on uncertainty over global supply outlook

Brent crude futures were down 9 cents, or 0.15%, at $60.97 a barrel at 1311 GMT, while U.S. West Texas Intermediate futures were 4 cents lower, down 0.07%, at $57.42.

Trump and Putin agreed on Thursday to another summit on the war in Ukraine, to be held in the next two weeks in Hungary.

“Now that the two leaders are expected to meet, it could be a sign that the U.S.’s stance on Russia may ease. If so, that should push prices lower,” said Tamas Varga, analyst at PVM.

Ukrainian drone strikes on Russian refineries and the threat of secondary sanctions on buyers of Russian oil such as India and China set a floor under the market, but this could now change, Varga said.

This week’s decline was also partly due to rising trade tensions between the U.S. and China, which added to concerns about an economic slowdown and lower energy demand.

“It just demolishes confidence,” said Jorge Montepeque, managing director at Onyx Capital Group. He expects the U.S. economy will quickly be impacted.

Also weighing on prices was the International Energy Agency’s outlook for a growing supply glut in 2026. The Energy Information Administration said on Thursday that U.S. crude inventories increased by 3.5 million barrels to 423.8 million barrels last week, compared with analysts’ expectations in a Reuters poll for a 288,000-barrel rise.

The bigger-than-expected build in crude inventory was largely due to lower refining utilization as refineries go into autumn turnarounds.

The data also showed a rise in U.S. production to 13.636 million barrels per day, the highest on record.

In the previous session, Brent settled 1.37% lower and U.S. WTI closed down 1.39%, their lowest since May 5.