Oil prices eased on Thursday as investors considered a potential trade truce between the U.S. and China. President Trump lowered tariffs on China after meeting with President Xi in South Korea. Brent crude fell 1.1% to $64.19 a barrel, while U.S. WTI crude dropped to $59.80.

Trump agreed to reduce tariffs on China to 47% in exchange for U.S. soybean purchases, rare earths exports, and a crackdown on fentanyl trade. Analysts see the agreement as a de-escalation of tensions rather than a structural change. Lower Brent prices defy robust drawdowns in U.S. oil inventories.

The U.S. Federal Reserve’s rate cut boosted the economic outlook, signaling potential support for commodities sensitive to economic activity. Brent and WTI prices rose in the previous session due to a larger-than-expected drawdown in U.S. crude and fuel inventories. Both benchmarks are on track for over 3% declines in October.

U.S. crude inventories fell by 6.86 million barrels to 416 million barrels in the week ending October 24, surpassing analysts’ expectations. Investors are keeping an eye on the upcoming OPEC+ meeting on November 2, where another 137,000 bpd supply hike for December is expected to be announced.

Read more at Yahoo Finance: Oil falls as investors assess US-China trade truce