Crude prices rebounded from a midday decline on Friday, buoyed by optimism that Hungary may utilize Russian crude oil, coinciding with U.S. President Donald Trump’s meeting with Hungary’s Prime Minister Viktor Orban at the White House. Brent crude futures concluded at $63.63 per barrel, reflecting an increase of 25 cents or 0.39%. U.S. West Texas Intermediate crude concluded at $59.75 a barrel, reflecting an increase of 32 cents, or 0.54%. Both benchmarks are set to experience weekly declines of approximately 2% as major global producers increase their output. “We are observing the meeting between Trump and Orban to determine if any agreements emerge that could lead to a relaxation of sanctions on Lukoil and Rosneft,” stated John Kilduff. Hungary has continued to depend on Russian energy since the onset of the 2022 conflict in Ukraine, eliciting criticism from various European Union and NATO partners.

Earlier in the day, prices experienced a decline, with Brent reflecting a loss attributed to flight reductions stemming from a shortage of air traffic controllers, who are currently unpaid due to the ongoing U.S. government shutdown. “The cessation of flights is significantly reducing diesel demand,” stated Phil Flynn. The U.S. Federal Aviation Administration mandated that airlines reduce thousands of flights due to a deficit of air traffic controllers. Decreased demand for jet fuel occurred as “the market continues to weigh a rising oil surplus against mixed macro,” stated analyst Ole Hvalbye. An unanticipated increase in U.S. inventories by 5.2 million barrels has rekindled concerns regarding oversupply this week, according to analyst Tony Sycamore. U.S. crude stocks experienced an increase that surpassed expectations, attributed to heightened imports and diminished refining activity, as reported by the Energy Information Administration on Wednesday. Meanwhile, inventories of gasoline and distillates saw a decline. Private reports indicated a deterioration in the U.S. labor market. The issuance of employment reports by the U.S. Labor Department is currently suspended due to the ongoing shutdown.

The Organization of the Petroleum Exporting Countries and its allies, collectively referred to as OPEC+, reached a decision on Sunday to implement a modest increase in output for December. Nevertheless, the group has decided to halt any additional increases for the first quarter of the upcoming year, cautious of a potential supply surplus. The well-supplied market led Saudi Arabia, the leading oil exporter globally, to declare a significant price reduction for its crude oil intended for Asian purchasers in December. Sanctions imposed by Europe and the United States on Russia and Iran are, in turn, affecting the supply chains of the world’s largest importers, namely China and India, thereby offering a degree of support to global markets. In October, China’s crude imports increased by 2.3% compared to September and were up 8.2% year-on-year, reaching 48.36 million tons, according to customs data. This rise occurs amid elevated utilization rates at refineries in the world’s largest oil importer. “China maintained high levels of crude imports in October,” analyst Giovanni Staunovo stated. “That action prevents those barrels from reaching the OECD, where stockpiles continue to be limited.”

Swiss commodities trader Gunvor announced on Thursday its decision to retract the proposal to acquire the foreign assets of Russian energy company Lukoil, following the U.S. Treasury’s characterization of the firm as Russia’s “puppet” and its indication of opposition to the transaction. “Gunvor scrapping its Lukoil assets purchase suggests the U.S. is maintaining its maximum pressure campaign against Russia, and potential strict enforcement of sanctions on Rosneft and Lukoil,” stated Vandana Hari.