Oil prices steady after dropping as economic uncertainty, supply concerns weigh

Oil prices steadied on Thursday after falling more than US$1 in the previous session as uncertainty over the outcome of trade talks between the US and China, the world's two largest oil consumers, weighed on investor sentiment.

Brent crude futures were unchanged at US$61.12 a barrel, while US West Texas Intermediate crude was up 6 cents, or 0.1 per cent, to US$58.12 a barrel at 0058 GMT. Both contracts slumped 1.7 per cent on Wednesday as investors doubted that the upcoming trade talks would result in a breakthrough.

US Treasury Secretary Scott Bessent will meet with China's top economic official on May 10 in Switzerland for negotiations over a trade war that is disrupting the global economy. The countries are the world's two largest economies and the disruptions from their trade dispute are likely to lower crude consumption growth.

US President Donald Trump on Wednesday suggested China initiated the trade talks, adding he was not willing to cut US tariffs on Chinese goods to get Beijing to negotiations. Bessent said the upcoming talks are a start, not "advanced" discussions.

Adding to concerns of weaker demand, US gasoline inventories rose last week, stoking concerns among analysts that consumption is not building as the US enters the summer demand period later this month.

At the same time, the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, will increase its oil output, adding to pressure on prices.

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