By Ahmad Ghaddar
LONDON (Reuters) – Oil prices stabilized on Wednesday as investors weighed optimism about a meeting between the leaders of major consumers the United States and China against an expected increase in production quotas at the next OPEC+ meeting.
Brent crude futures were up 11 cents, or 0.2%, at $64.51 a barrel by 1020 GMT, while U.S. West Texas Intermediate crude futures were up 6 cents, or 0.1%, at $60.21.
China’s Foreign Ministry said Chinese President Xi Jinping will meet US President Donald Trump on Thursday in the South Korean city of Busan.
He said the meeting would “inject new impetus into the development of US-China relations”, adding that Beijing was willing to work together to achieve “positive results”.
China also said it was open to continuing cooperation with the United States on fentanyl after Trump said he hoped to reduce tariffs on Chinese products in exchange for Beijing’s commitment to curb exports of precursor chemicals.
Also supporting prices was an expected drop in U.S. crude and fuel inventories last week.
Crude stocks fell by 4.02 million barrels during the week ending Oct. 24, market sources said, citing American Petroleum Institute figures on Tuesday.
Gasoline inventories fell by 6.35 million barrels, while distillate inventories fell by 4.36 million barrels from the previous week, the sources said.
“The API report showing large withdrawals of crude oil and refined products last week in the United States is providing modest support to prices,” said UBS analyst Giovanni Staunovo.
Last week, Brent and WTI posted their biggest weekly gains since June after US President Donald Trump imposed Ukraine-related sanctions on Russia for the first time in his second term, targeting major oil companies Lukoil and Rosneft.
Still, doubts that sanctions would offset excess supply and rumors of an increase in OPEC+ production pressured prices; Both benchmarks fell 1.9%, or more than $1, in the previous session.
OPEC+, the world’s largest group of oil-producing nations, is leaning toward a modest output increase in December, four sources familiar with the talks said, with two sources citing an additional 137,000 barrels per day.
On Tuesday, the chief executive of Saudi state oil giant Aramco said demand for crude oil was strong even before sanctions were imposed on Russian oil majors and that Chinese demand was still healthy.
((Reporting by Ahmad GhaddarAdditional reporting by Sam LiEditing by Alexander Smith)