- WTI rises but is still set for its eighth straight weekly loss.
- Crude Oil prices climb following new US sanctions on Iranian oil and Hong Kong-flagged vessels linked to Iran’s shadow fleet.
- Oil demand struggles due to heightened global trade tensions after Trump threatened a 200% tariff on European wines and champagne.
West Texas Intermediate (WTI) Oil price edges higher on Friday after losing more than 1% in the previous session. However, WTI remains on track for its eighth consecutive weekly decline, trading around $66.70 per barrel during Asian hours. The price uptick comes as fresh US sanctions on Iranian Oil and shipping provide some support.
On Thursday, the US imposed new sanctions targeting Iran’s Oil minister as part of its ongoing “maximum pressure” campaign against Tehran. The sanctions also extend to several Hong Kong-flagged vessels involved in Iran’s shadow fleet, which helps conceal oil shipments, according to the US Treasury Department.
Despite this, crude Oil remains under pressure due to broader macroeconomic concerns. Fears that global trade tensions could dampen demand persist, especially after US President Donald Trump threatened a 200% tariff on all European wines and champagne during Thursday’s early US session, sparking concerns in global markets.
Additionally, uncertainty looms over a proposed US-brokered ceasefire between Russia and Ukraine. Russian President Vladimir Putin stated on Thursday that Moscow agrees with the US proposal but insists that any ceasefire must pave the way for lasting peace and address the root causes of the conflict. European Union (EU) High Representative for Foreign Affairs and Security Policy, Kaja Kallas, suggested that Russia is likely to accept the ceasefire proposal but with conditions, according to Reuters.
Further pressuring Oil prices, the International Energy Agency (IEA) warned that a growing supply surplus could intensify as trade tensions weigh on demand while The Organization of the Petroleum Exporting Countries and its alias, known as OPEC+, ramp up production. The IEA projects that global Oil supply will outpace demand by approximately 600,000 barrels per day (bpd) this year, driven by US-led supply growth. Meanwhile, demand growth is forecast at 1.03 million bpd—70,000 bpd lower than last month’s estimate.
