West Texas Intermediate (WTI) oil prices rallied on Friday, climbing 3.13% to trade around $100.90 and breaking above the $100 mark to reach a new weekly high [1]. This surge was driven by comments from US President Donald Trump, who stated that China had agreed to purchase US oil following his summit with Chinese President Xi Jinping [1]. However, Chinese authorities have not officially confirmed such an agreement, though the market responded positively to the prospect of increased global demand [1].
Geopolitical risks also contributed to the rally, as tensions surrounding the Strait of Hormuz persisted. The Trump-Xi meeting concluded without any major announcement regarding the reopening of this critical oil export route, though Trump claimed Beijing would participate in efforts to reopen it, without providing operational details [1]. Rabobank analysts warned that even a temporary closure of the Strait could significantly increase energy prices, and a prolonged disruption could force demand reductions in sectors such as aviation and logistics [1].
Meanwhile, the Organization of Petroleum Exporting Countries (OPEC) faces significant upheaval following the United Arab Emirates' (UAE) announcement that it would quit OPEC and OPEC+ on May 1 [2]. Experts predict that the potential collapse of OPEC could lead to lower gasoline prices, as the cartel has historically kept crude prices elevated by restricting production [2]. Phil Flynn, a senior market analyst, stated that the breakup of OPEC should result in more competitive pricing and lower prices for consumers [2].
Elaine Dezenski of the Foundation for the Defense of Democracies noted that the UAE's departure removes both production weight and institutional credibility from OPEC, posing a concern for remaining members such as Saudi Arabia [2]. Some analysts believe the UAE's move could trigger a domino effect, with other countries potentially following suit to increase their own production [2].
The combination of US-China trade developments, ongoing Middle East supply risks, and structural changes within OPEC are creating significant volatility and uncertainty in the global oil market [1][2].
CONCLUSION
WTI oil prices have surged above $100, fueled by President Trump's claims of new Chinese purchases and ongoing geopolitical tensions in the Middle East. At the same time, OPEC's stability is in question following the UAE's exit, with analysts predicting increased competition and potentially lower prices ahead. The market remains highly sensitive to both geopolitical developments and structural shifts in global oil supply.