Oil Market Faces Pressure, Brent Price Hovers at $70
Oil prices have steadily declined throughout the week, driven by geopolitical tensions, OPEC+ supply adjustments, and growing concerns over a global economic slowdown fueled by US trade policies.
The international benchmark Brent crude traded at $70.47 per barrel, down by around 3.4% from last week’s closing price of $72.96 per barrel. West Texas Intermediate (WTI), the American benchmark, traded at $67.23 per barrel at the same time on Friday, down about 3.6% from last Friday’s closing price of $69.77 per barrel.
The tariffs announced by the US on Tuesday have fueled fears of a potential trade war. US President Donald Trump announced a 25% tariff on imports from Canada and Mexico, alongside an increase in tariffs on Chinese goods from 10% to 20%.
Analysts warn that these measures could stifle economic growth and weaken energy demand, leading to downward pressure on oil prices. Oil markets also reacted to OPEC+ reaffirming its decision to gradually increase production from April 2025 on Monday.
The group confirmed that it would phase out voluntary production cuts of 2.2 million barrels per day, marking the first increase since 2022.
The decision to stabilize supply contributed to declining oil prices as investors anticipated oversupply in the coming months. On Tuesday, Brent crude fell below $70 per barrel for the first time since October 2024, with WTI also experiencing a notable drop.
Meanwhile, the US Energy Information Administration (EIA) announced that commercial crude oil stocks in the country increased by about 3.6 million barrels last week.
A larger-than-expected rise in crude inventories added to concerns about weakening domestic demand. Oil prices briefly rebounded on Thursday after the US administration announced temporary exemptions on certain tariffs under the US-Mexico-Canada Agreement (USMCA).
The move eased some trade war concerns, though uncertainty remains regarding future tariff policies and their potential impact on global markets.
Last week, a tense Oval Office meeting between Trump and Zelensky over a failed rare-earth deal fueled market volatility. However, European leaders at a UK summit reaffirmed their support for Ukraine. If peace talks progress, easing geopolitical risks and oversupply concerns may keep oil prices down.
Additionally, US Treasury Secretary Scott Bessent’s call for tougher sanctions on Russia and Iran—including a ‘maximum pressure’ campaign on Iran’s oil and Russia’s energy exports—raised supply concerns, providing limited upward support to oil prices. #Oil Market Faces Pressure, Brent Crude Price Hovers at $70 Naira Extends Rally on Declining Foreign Reserves
