Crude prices slipped in Asian trading on Monday following OPEC+’s decision to ramp up oil production again in September. Concerns over a potential slowdown in the U.S. economy and uncertainties surrounding sweeping trade tariffs added further pressure to the market.
The downward momentum extended losses from Friday, driven by disappointing U.S. nonfarm payroll figures that signaled a possible cooling in demand from the world’s largest oil consumer. Additionally, investor sentiment remained fragile after President Donald Trump announced extensive tariff measures targeting at least 70 nations, sparking fears of global trade disruption.
By 21:40 ET (01:40 GMT), September contracts for Brent crude declined by 0.5% to $69.35 per barrel, while West Texas Intermediate (WTI) futures dropped 0.3% to $65.90 per barrel.
Despite Monday’s drop, crude benchmarks had seen modest gains the previous week, fueled by the U.S. threatening additional sanctions on Russian energy exports, a move that could tighten international supply lines.
OPEC+ Sticks to Gradual Output Strategy
On Sunday, the coalition of oil-producing countries known as OPEC+, including Russia and Saudi Arabia, agreed to raise collective output by 547,000 barrels per day in September. The decision mirrors the group’s August increase and continues a six-month streak of supply expansions.
This production strategy reflects the bloc’s efforts to unwind historic supply curbs introduced during the pandemic, with previous increases of around 548,000 barrels per day in August and 411,000 barrels per day in July.
The announcement renewed fears that rising global oil supplies could outweigh the tightening effects of U.S. sanctions on Russia, potentially leading to softer prices in the months ahead.
Signs of Slowing U.S. Demand Add to Bearish Outlook
In addition to OPEC+ developments, fresh labor market data from the U.S. cast doubt on future fuel demand. July’s nonfarm payrolls report revealed weaker-than-expected job growth, underscoring vulnerabilities in the broader economy.
Those concerns were magnified by the looming implementation of President Trump’s sweeping trade tariffs. Most of these duties are set to take effect in the coming days, adding layers of complexity to the global economic outlook.
Further dampening sentiment were recent figures from U.S. purchasing managers’ indexes, which signaled declining business activity—another negative signal for energy demand.
Nonetheless, some geopolitical tensions offered temporary support last week. Trump threatened to impose trade penalties on nations purchasing Russian oil, naming China and India specifically. He also escalated rhetoric around the conflict in Ukraine, warning of potential military action against Moscow.
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