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West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $57.55 during the early Asian trading hours on Wednesday. The WTI rises as a sign that easing US-China trade friction overrode the effects of gains in the US Dollar (USD) and excess supply concerns. Traders await the US Energy Information Administration (EIA) stockpiles report later on Wednesday. 

US President Donald Trump last week threatened a new 100% tariff on China and suggested he would skip a meeting with Chinese President Xi Jinping to be held in South Korea later this month. Trump softened his stance over the weekend, saying that high tariffs on China are unsustainable, and expressed willingness for smoother relations with China. 

Trump late Wednesday predicted an upcoming meeting with his Chinese counterpart, Xi Jinping, would yield a “good deal” on trade. However, he also conceded that the highly anticipated talks may not happen. 

US Treasury Secretary Scott Bessent is set to meet with his Chinese counterparts to discuss a de-escalation of trade tensions ahead of the Trump-Xi talks. Any signs of easing trade tensions between the US and China,  the world's two largest economies and major consumers of crude oil,  could lift the WTI price in the near term. 

Data released by the American Petroleum Institute (API) on Tuesday revealed that crude oil stockpiles in the US for the week ending October 17 fell by 2.98 million barrels compared to a rise of 3.524 million barrels in the previous week. Crude oil inventories in the US are so far still showing a net loss for the year, losing 2.423 million barrels according to Oilprice calculations of API data.

The Organization of the Petroleum Exporting Countries and its allies (OPEC+) have pushed ahead with plans to increase oil supply. This has led analysts to predict a surplus of crude this year and next year. The International Energy Agency (IEA) last week projected a global surplus of nearly 4 million barrels per day in 2026. Concerns over excess supply might cap the upside for the WTI price. 

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