Oil prices rise about 2% as Trump–Xi Iran remarks weigh on markets

Oil prices rose by around 2% after U.S. President Donald Trump said he and China’s President Xi Jinping agree Iran cannot have nuclear weapons, while concerns persisted over maritime security in the Strait of Hormuz despite Tehran reporting increased vessel traffic.

Brent crude oil futures rose $1.77, or 1.67%, to $107.49 a barrel at 0642 GMT, after hitting a session high of $107.99 earlier in the day. U.S. West Texas Intermediate futures gained $2.13, or 2.11%, to $103.30 a barrel, Reuters learned. 

For the week, Brent has climbed nearly 6%, while WTI has jumped more than 7%, driven by uncertainty over a fragile ceasefire linked to the Iran conflict.

Trump said his patience with Iran is running out and stated that he had agreed with Xi that Tehran cannot be allowed to have a nuclear weapon and must re-open the Strait of Hormuz.

Xi did not comment on his discussions with Trump about Iran, although China’s foreign ministry issued a statement.

“This conflict, which should never have happened, has no reason to continue,” the ministry said.

Market analysts said sentiment remained focused on geopolitical risk and supply concerns.

"This conflict, which should never have happened, has no reason to continue," the ministry said.

“With the Beijing summit not delivering any breakthrough on Iran, market focus is back on the deadlock and a blockaded Strait, with a tail risk of renewed military escalation,” said Vandana Hari, founder of oil market analysis provider Vanda Insights.

Among expectations tied to the summit, Trump said China wants to buy oil from the United States.

The White House said Trump and Xi had agreed on the need to keep the shipping lane open.

By Sabina Mammadli