Crude Clings To Gains Amid Trump’s Tehran Pressure, Shrinking US Stockpiles

Oil prices clung to gains early Thursday after U.S. President Donald Trump doubled down on his maximalist position on Iranian crude, even as signs emerged that diplomatic talks could be in the works. 

Brent crude hovered close to $68 a barrel, while West Texas Intermediate (WTI) futures stayed above $65 after both crude benchmarks eked out small increases on Wednesday.

Additionally, U.S. oil inventories continued to fall, which also helped lift the mood in the market.

Trump said he was remaining committed to his maximum pressure campaign to cut off Iranian oil revenues, despite earlier comments suggesting China may not abide by a ban on purchasing from Tehran.

“If they’re going to sell oil, they’re going to sell oil,” he said, while also indicating that China could just as easily purchase from other sources, including the U.S.

This came days after a truce between Israel and Iran helped calm fears of supply disruptions in the Middle East. 

Trump described the conflict as effectively over but warned fighting “could maybe start soon.”

According to government figures, crude inventories in the U.S. fell for the fifth consecutive week, dropping by nearly 5.84 million barrels. 

That brought overall stockpiles to the lowest seasonal level in over a decade. 

Supplies at the key Cushing hub also declined again, while gasoline demand surged to its highest since late 2021.

Refiners are processing more crude as Americans take advantage of lower fuel prices and hit the roads. 

The increase in demand provided a partial offset to the market’s geopolitical worries.

Now traders look ahead to the July 6 OPEC+ meeting, where the group will set its output levels for August. 

On Saturday, Rosneft CEO Igor Sechin said OPEC+ may advance its planned output hikes by about a year.

SBI Research noted that global shipping activity, particularly crude transport, reflects heightened geopolitical tensions. 

While China’s Crude Tanker Freight Index (CTFI) has surged, the Baltic Dirty Tanker Index remains below recent highs. 

They suggested maritime insurance pricing will be a key indicator of volatility ahead.

Under a base case, SBI expects crude prices to rise to $82–$85 per barrel, which are levels they believe may not significantly disrupt key economic metrics like the current account deficit or balance of payments. 

On Stocktwits, retail sentiment for Light, Sweet Crude Oil Futures was ‘extremely bullish’ with ‘high’ message volume.

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