Oil prices declined on 13 May amid uncertainty over a tenuous ceasefire in the Middle East, as US President Donald Trump prepares to meet his Chinese counterpart Xi Jinping in China.
At 06:30 GMT, Brent crude futures had decreased by $1.47, or 1.4%, to reach $106.30 a barrel (bbl), reported Reuters.
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Meanwhile, US West Texas Intermediate (WTI) futures had declined by $1.41, or 1.4%, settling at $100.77/bbl.
On Tuesday, oil prices increased by more than 3%, building on previous gains as the likelihood of a durable US-Iran ceasefire diminished. This reduced the chances of reopening the Strait of Hormuz, which typically handles around 20% of the world’s oil and liquefied natural gas volumes.
Since late February, when the US and Israel launched strikes on Iran and Tehran effectively closed the Strait of Hormuz, both benchmarks have mostly remained near or above the $100/bbl level.
President Trump remarked that he does not foresee needing China’s involvement to resolve the conflict with Iran, despite the deteriorating hopes for a lasting peace.
The US-China discussions are set to take place later in the week in Beijing.
Despite sanctions pressure from the Trump administration, China remains the largest purchaser of Iranian oil.
The ongoing conflict with Iran is affecting the US economy, the largest in the world, particularly as increased oil prices push fuel costs higher.
Meanwhile, the United Arab Emirates’ exit from OPEC as of May 2026 is affecting future production figures in energy reports.
Recent data highlights an estimated reduction of 10.5 million barrels per day across several Middle Eastern countries.
The US Energy Information Administration anticipates that the Strait of Hormuz will remain closed through May, with normal traffic resuming by June and shipments normalising later in the year.
Oil price movements have closely tracked changes in global inventory levels. Brent crude prices peaked at $138/bbl in early April, with average prices at $117/bbl for the month.
Forecasts indicate that retail gasoline prices will average $3.88/gal in 2026 and slightly decrease in 2027.
The US propane inventory surplus, due to supply growth outpacing demand, is expected to persist, with increased exports to Asia set to compensate for reduced Middle Eastern shipments.
In April, US LNG export capacity grew by approximately 900 million cubic feet per day due to project expansions.
During the first quarter of 2026, US-marketed natural gas production averaged 120.2 billion cubic feet per day, a 4% increase from the same period the previous year.
Output is expected to continue rising through 2027, supported by associated gas connected to elevated crude oil prices.
