Oil prices edged lower during early Tuesday trading in Asia, as markets reacted to rising geopolitical tension fueled by fresh U.S. trade tariffs and concerns over increased global oil supply from the OPEC+ alliance.
By 01:40 GMT (21:40 ET Monday), Brent crude futures for September delivery slipped 0.7% to $69.11 per barrel, while West Texas Intermediate (WTI) fell by the same margin to $67.46. This pullback came after both benchmarks climbed over 1% on Monday, supported by expectations of sustained market tightness despite looming supply increases.
Trump Targets Trade Partners with Sweeping Tariff Threats
U.S. President Donald Trump intensified his protectionist trade agenda on Monday, issuing formal notices to 14 countries about forthcoming tariff hikes set to take effect on August 1. Key Asian trading partners Japan and South Korea were among those notified of a 25% tariff across all exports, while other nations, including Thailand, Serbia, and Tunisia, face potential levies of up to 40%.
Trump’s executive order extended the initial July 9 deadline, offering additional time for negotiations but warning that the August 1 timeline remains largely fixed. The uncertainty surrounding the implementation of these tariffs — particularly for major energy-consuming nations like Japan, South Korea, and India — has raised fears of disrupted global trade flows and weakened industrial demand.
OPEC+ Signals Bigger Supply Boost as Cuts Wind Down
Meanwhile, the spotlight remains on OPEC+ after the oil-producing coalition announced a production increase of 548,000 barrels per day for August, exceeding the monthly hikes of 411,000 bpd seen in the preceding three months. The group also hinted at a similar potential rise in September, which will be reviewed during its upcoming meeting on August 3.
This expansion continues the unwinding of the voluntary 2.2 million bpd in supply cuts led by key producers like Saudi Arabia and Russia, aimed at stabilizing oil markets earlier in the year.
Although oil prices tumbled early Monday on the news of higher supply, they rebounded later after Saudi Arabia raised the official selling price (OSP) of its Arab Light crude to Asian buyers for August delivery — a move interpreted by traders as a vote of confidence in demand recovery.
Leave a Reply