Oil prices climbed following a summit between U.S. President Donald Trump and Chinese President Xi Jinping, as both leaders discussed the importance of keeping the Strait of Hormuz open, according to reports from CNBC and TMGM. International benchmark Brent crude futures for July rose 2.4% to $108.22 a barrel, while U.S — West Texas Intermediate (WTI) futures for June increased by 2.79% to $103.39 per barrel. Trump and Xi agreed the strategic waterway must remain unblocked, a White House official confirmed.

Geopolitical Uncertainty and Economic Agreements

Trump announced that China had agreed to purchase U.S. oil, with shipments expected to start in Texas, Louisiana, and Alaska, as “They’ve agreed they want to buy oil from the United States,” Trump told Fox News. However, Chinese authorities have not confirmed the deal, and no response was received from Beijing before the report’s publication. U.S. Treasury Secretary Scott Bessent added that China will work behind the scenes to help reopen the Strait of Hormuz, which is vital for global oil trade.

The meeting between Trump and Xi occurred against the backdrop of ongoing tensions between the U.S. and Iran, which had initially delayed Trump’s trip to China. The conflict has reduced expectations for major diplomatic breakthroughs, with the U.S. strike on Iran putting China in a difficult position — Experts debated whether the planned summit would proceed following the U.S. and Israeli attacks on Iran, according to a report from 경향신문.

Strait of Hormuz and Energy Markets

Both leaders emphasized the need to keep the Strait of Hormuz open, a sensitive issue for global oil markets; the strategic waterway is important for transporting a significant portion of the world’s oil and gas. White House officials described the discussions as “good” and noted efforts to strengthen economic cooperation; Trump also invited Xi to the White House on September 24, while Xi stressed the need for stable U.S.-China relations.

The International Energy Agency (IEA) warned that global oil supply is expected to remain below demand this year due to disruptions caused by the Iran war. Despite this. Oil prices have seen a reversal. With WTI trading at around $97.30, up 0.34%, after initially falling to $95.50; the IEA’s warning highlights the persistent supply deficit in the global oil market, according to TMGM.

Regional and Currency Impacts

The improved U.S.-China relations and firm U.S. economic data backed the U.S. Dollar, putting pressure on the New Zealand Dollar (NZD). The NZD/USD pair fell to around 0.5920, down 0.28% on the day. The U.S. Dollar strengthened as markets anticipated a prolonged restrictive monetary policy stance. White House officials described the Trump-Xi discussions as “extremely positive and constructive,” highlighting the importance of economic cooperation and geopolitical stability.