Oil Prices Dip Amid Tariff Uncertainty and Rising OPEC+ Output

Oil prices declined on Monday as concerns over the impact of U.S. import tariffs on global economic growth and fuel demand weighed on the market. Additionally, rising output from OPEC+ producers added further pressure on prices.

Brent crude saw a slight drop of 6 cents, settling at $70.30 per barrel by 07:20 GMT after a strong gain of 90 cents on Friday. Similarly, U.S. West Texas Intermediate (WTI) crude dipped by 8 cents to $66.96 per barrel, following a 68-cent increase in the previous trading session.

According to the latest data from the Organization of the Petroleum Exporting Countries (OPEC), the price of its basket of twelve crudes stood at $75.16 per barrel on Friday, up from $74.98 the previous day.

WTI recorded its seventh consecutive weekly decline, marking its longest losing streak since November 2023. Meanwhile, Brent crude faced its third straight week of losses.

The downward trend followed President Donald Trump’s decision to impose, then delay, tariffs on Canada and Mexico—both key oil suppliers to the U.S.—while simultaneously increasing taxes on Chinese imports.

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In response, China retaliated with tariffs on agricultural products from the U.S. and Canada, further unsettling global markets.

Analysts from ING highlighted tariff uncertainty as a major factor behind the weakness in oil prices. Additionally, Saudi Arabia’s decision to cut prices and deflationary signals from China have contributed to the bearish sentiment in the market.

IG analyst Tony Sycamore pointed out other crucial elements influencing oil prices, including concerns over U.S. economic growth, the potential lifting of U.S. sanctions on Russia, and the decision by OPEC+ to increase output.

Despite the downward pressure, Sycamore suggested that support levels around $65-$62 for WTI could hold firm before a potential rebound to $72 per barrel.

On Friday, oil prices regained some ground after President Trump announced plans to tighten sanctions on Russia if it fails to negotiate a ceasefire with Ukraine. This move could provide temporary support to oil prices by adding geopolitical risk to the equation.

While uncertainties persist in the market, the coming weeks will be crucial in determining whether oil prices stabilize or continue their downward trajectory.