"Iran rejected a potential compromise, saying it won't support even a small increase in oil production". On Wednesday, U.S. crude closed at $65.74 a barrel, down from a peak of almost $73 last month, and Brent crude, the worldwide standard, closed at $74.61, down from $80.
While U.S. oil production may not be quite up to the levels of oil giants Russian Federation and Saudi Arabia, losing the Chinese market would certainly deal a blow to American oil producers, which ship more than $1 billion of oil per month to Beijing.
Oil prices surged almost 75 percent, touching $80 a barrel, after OPEC and allies agreed to cut production in late 2016.
Iranian Oil Minister Bijan Zanganeh said Tuesday that Trump was responsible for the surge in oil prices after applying sanctions against Iran and Venezuela.
Looming over all financial markets is an escalating trade dispute between the United States and its other major trading partners, particularly China.
US benchmark oil prices were slightly lower Thursday while oil prices in Europe and Asia were down sharply, as investors expect a likely decision Friday by global producers to pump more oil will impact overseas markets more than USA markets.
"OPEC is listening to consumers", Bob Dudley, the chief executive of BP Plc, said on the sidelines of the OPEC conference in Vienna.More news: Signs bad for Messi's last chance to emulate Maradona
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"Other energy ministers, such as Iraq's Jabbar Ali Hussein Al-Luiebi, have expressed more optimism about an agreement". Iran does at least "understand the necessity to reduce cuts" and has agreed to discuss the matter, Oman's Oil Minister Mohammed Al Rumhy said earlier in the day.
Phil Flynn, an oil analyst with The Price Futures Group, expects a deal for around an extra 1 million barrels a day.
Global benchmark Brent crude fell more than 2 per cent on Thursday ahead of a meeting of the Organization of the Petroleum Exporting Countries, where producers were expected to boost output to stabilize prices.
Other OPEC-members, including Iran, are against such a move, fearing a sharp slump in prices.
Signalling that positions might be softening, Saudi's Falih acknowledged that "not every country can respond to an allocation of higher production" and said it was important to be "sensitive" to those concerns.
Trump's involvement in pressing for OPEC to act - which in addition to his tweets include a behind-the-scenes request for a 1 million-barrel-a-day supply hike - could make it hard for Tehran to accept a compromise. "The already fragile world economic growth will be at threat if oil prices persist at these levels".
With assistance from Annmarie Hordern, Manus Cranny, Nayla Razzouk, Salma El Wardany, Laura Hurst, Julian Lee, Elena Mazneva, Francois de Beaupuy and Golnar Motevalli. All comments are subject to editorial review.