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First Look - Oil rises as US and China agree to start trade talks

US and China officials to begin trade talks
- Oil prices gained after the US and China agreed to start trade negotiations
- WTI prompt-month contract climbed $0.28 to $59.37/Bbl early Wednesday morning (7:30 AM CT)
- US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are set to meet Chinese officials in Switzerland later this week
China suspends US crude imports (Bloomberg)
- China stopped importing US crude in March as trade tensions escalated between the two nations
- The world’s top oil buyer had brought in 149 MBbl/d of US crude in February
- China imported a record 481 MBbl/d in 2020 but cut volumes by half in 2024
Kazakhstan weighs OPEC+ production cuts (Bloomberg)
- Kazakhstan is reviewing its options to comply with OPEC+ production cut targets following renewed pressure from Saudi Arabia on overproducing members
- The country pledged to produce 1.5 MMBbl/d in June, down from 1.85 MMBbl/d in March
  - Details on how Kazakhstan will achieve the target were not disclosed

Natural gas is higher by more than 10c, as prices remain near a multi-week high
- The Winter ‘25/’26 strip is 6c higher to $4.76/MMbtu, while Summer ’26 is up 1.5c to $4.18/MMbtu (8:15 AM)
- Lower 48 gas production has remained lower following yesterday's drop, with S&P data showing output at 104 Bcf/d
Freeport LNG loses power (BBG)
- The Freeport LNG export plant lost power yesterday, resulting in flows dropping from 2.2 Bcf/d to only 0.3 Bcf/d
- As of this morning’s nominations, inflows into the plant have returned to 1.98 Bcf/d, implying the facilities' liquefaction trains have come back online
- A reason for the power outage was not given, although these types of events happen at Freeport with some regularity
EU to help US firms meet LNG methane rules (BBG)
- The EU has agreed to strengthen regulations regarding methane emissions, which foreign producers will have to comply with gradually over the coming years
- The block said it's willing to help US gas exporters comply with the methane emission rules to facilitate increased trade
- The EU plans to ban all remaining Russian gas supply by 2027, and is looking to make up for it with US LNG