Stability of Oil Prices Amid Trade Tensions

SadaNews - Oil prices stabilized as traders assessed a significant increase in U.S. crude inventories and a new wave of tariffs announced by U.S. President Donald Trump.

Brent crude remained close to the $70 per barrel level after closing virtually unchanged on Wednesday, while West Texas Intermediate crude stood around $68.

According to official data, U.S. inventories rose by about 7.1 million barrels last week, the largest increase since January. Additionally, stocks at the Cushing storage hub increased for the first time since May.

Tariff messages pressure global markets

The market continues to monitor a stream of tariff imposition messages issued by Trump, with Brazil being the latest victim of high tariffs, following previous threats to impose taxes on copper imports and other countries. Trump's trade policies and commitments from targeted countries to retaliate have confused global markets.

Despite these disruptions, oil prices remain slightly elevated this week, even after the OPEC+ decision on Saturday to increase production in August beyond expectations.

The group is counting on strong summer demand to absorb the additional supplies; however, there are concerns about a potential surplus in the market later in the year as consumption declines after the summer peak.

At the same time, traders are closely watching for any potential escalation in tensions in the Middle East, after Iran-backed Houthis intensified attacks on ships in the Red Sea, leading to the sinking of two vessels and the loss of several sailors. These attacks come in the wake of a conflict between Israel and Iran, which has been interrupted by a fragile truce.

Source: Bloomberg