Brent crude oil futures traded around $74.8 per barrel on Friday, heading for a third consecutive weekly decline after President Trump reaffirmed plans to boost US oil production to drive crude prices lower.
Brent set for third weekly decline
His pledge came amid concerns over an already elevated supply, following a sharper-than-expected rise in US crude stockpiles—the largest build in nearly a year. This surge in inventory levels, along with the prospect of increased US production, has raised doubts about the sustainability of recent price gains, putting downward pressure on the market.
Limiting further losses, the US ramped up sanctions on Iran early in the week, potentially restricting its oil flows and tightening global supply. The sanctions, targeting key sectors of Iran's economy, aim to reduce the country’s oil exports, further complicating an already tense energy market. Additionally, Saudi Aramco sharply raised March crude prices, driven by rising demand from China and India, two of the world's largest oil consumers. The increase in demand from these countries has provided support to prices, while disruptions in Russian oil supply have also contributed to tightening market conditions, offsetting some of the bearish sentiment.
US-China trade tensions persist
Meanwhile, US-China trade tensions persisted as Beijing imposed tariffs on American oil, LNG, and coal in response to Trump’s recent measures. Although these tariffs are expected to have a limited impact, given China’s relatively modest imports of US energy products, the ongoing trade spat has added another layer of uncertainty to the oil market. The standoff continues to fuel volatility, particularly as the global energy market remains sensitive to geopolitical developments and shifts in trade policies. As a result, while Brent crude prices are experiencing downward pressure from concerns over supply and elevated inventories, the combination of sanctions, demand from Asia, and geopolitical risks are likely to keep the market relatively volatile in the near term.
