Oil Prices Dip as Strong Dollar and Trump–Xi Meeting Weigh on Markets
Oil prices slipped slightly during Asian trading hours on Thursday, pressured by a stronger U.S. dollar after the Federal Reserve tempered expectations for another interest rate cut in December.
Traders also remained cautious ahead of the highly anticipated meeting between U.S. President Donald Trump and Chinese President Xi Jinping. The outcome of this meeting is expected to set the tone for future trade relations between the two largest economies in the world.
The dollar’s strength weighed on crude prices after the Fed announced a rate cut but signaled that additional cuts this year were unlikely. The greenback surged sharply on Wednesday before easing modestly in Asian trade.
Brent crude futures for December delivery fell 0.2% to $64.81 per barrel, while West Texas Intermediate (WTI) futures slipped 0.3% to $60.31 per barrel as of 21:18 ET (01:18 GMT).
Trump–Xi Meeting in Focus Amid Trade Tensions
President Trump and President Xi are set to meet Thursday in South Korea, on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit.
Markets expect their discussion to help reduce recent trade tensions that have added uncertainty to global markets throughout October.
In the lead-up to the meeting, both Washington and Beijing have taken conciliatory steps, raising hopes for a potential breakthrough toward a broader U.S.–China trade deal.
Strong Dollar Keeps Oil Under Pressure
Oil markets remained under pressure from the rising dollar, which climbed nearly 0.6% overnight against a basket of major currencies. A stronger dollar typically weighs on commodity prices, making them more expensive for non-U.S. buyers.
The dollar’s rally followed the Fed’s 25-basis-point rate cut, but Fed Chair Jerome Powell downplayed expectations for more cuts this year. He cited ongoing economic risks linked to a prolonged government shutdown and global uncertainty.
While Thursday’s rate cut had been largely priced in, oil prices initially saw limited gains as lower interest rates tend to stimulate growth and fuel demand. However, doubts over future monetary easing quickly capped those gains.
Crude prices remain in the red for October and are on track for their third consecutive monthly decline, pressured by persistent worries about oversupply and weakening demand.
