Oil Prices See Weekly Surge Amidst Tariffs Waves
Oil prices posted a mixed but generally upward trend this week, driven by unexpected changes in supply data and a series of high-level trade developments involving the US and key global partners.
The US tariffs triggered uncertainties in the global commodity market as implementation commences on August 1. The international benchmark Brent crude was trading at $70.93 per barrel on Friday, marking an increase of around 5% from last week’s closing price of $67.59.
Similarly, the American benchmark West Texas Intermediate (WTI) traded at $68.07 per barrel, an increase of approximately 5% from last Friday’s close of $64.82. Despite midweek pressure from demand-side indicators, prices remained relatively supported by tightening supply risks and geopolitical uncertainty.
Prices surged after the US and EU reached a major trade deal, easing supply concerns and boosting optimism over future demand. The agreement includes $600 billion in EU investments in the US and $750 billion in purchases of American energy and military products.
Analysts said the deal, which reduced uncertainty and could stimulate economic activity, raised hopes for higher energy consumption and gave upward momentum to oil markets.
Also, Trump threatened Moscow with new sanctions and secondary tariffs if it failed to end the conflict within 10 to 12 days, raising concerns over possible disruptions to Russian oil supply.
The US Treasury Department announced this week more than 115 new sanctions targeting individuals and entities involved in oil transport from Iran and Russia.
The package was described as the most extensive against Iran since 2018, raising fears of tighter global supply, especially with both countries being key oil exporters. Concern over tighter supply supported the increase in oil prices.
Meanwhile, the Federal Reserve (Fed) decided to keep rates steady during its July 29-30 meeting. Analysts warned that ongoing high interest rates could strengthen the US dollar, making oil more expensive for foreign buyers and dampening demand.
Prices edged lower as the American Petroleum Institute reported a surprise 1.5 million-barrel increase in US crude inventories. US Energy Information Administration, reported an even larger-than-expected build of 7.7 million barrels, signaling weakening demand in the world’s biggest consumer.
Investors continue to monitor developments in the Russia-Ukraine conflict, the full implementation of US sanctions, and upcoming economic indicators to gauge the future trajectory of oil markets. #Oil Prices See Weekly Surge Amidst Tariffs Waves Nigeria’s Price Inflation Eases to Weakest Since May 2023 – PMI
