Crude oil prices dipped on Friday as volatility in the global commodity market persisted, driven by a complex mix of supply-demand imbalances and geopolitical tensions. The imbalance appears multidimensional: the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) are increasing production, even as demand weakens—particularly in China, where sluggish economic data and tariff concerns are dampening consumption outlook.
The ongoing Russia-Ukraine war continues to disrupt both the supply and demand dynamics of global crude, while escalating tensions in the Middle East, particularly involving Israel, are also contributing to market unease.
Despite these pressures, oil prices managed to remain relatively stable, buoyed slightly by developments such as renewed US-China trade communications and continued geopolitical friction in Eastern Europe.
Brent crude, the international benchmark, edged up 0.04% to trade at $65.03 per barrel, compared to $65.00 in the previous session. Similarly, US benchmark West Texas Intermediate (WTI) gained 0.06% to $62.64 per barrel, up from $62.60.
Supply-side uncertainty grew further amid reports of potential new US sanctions on Russia and stalled nuclear negotiations with Iran—both of which could impact global supply chains. Meanwhile, OPEC+ reaffirmed its intention to increase output starting July, in line with previous guidance.
On the demand side, weak macroeconomic signals from both the United States and China continued to weigh heavily. A notable build-up in US petroleum product inventories only added to concerns about sluggish demand in the near term.
Elsewhere, a phone conversation on Thursday between US President Donald Trump and Chinese President Xi Jinping revived cautious optimism around trade negotiations. However, analysts warn that the possibility of additional US tariffs still looms, leaving markets wary of a sustained breakthrough.
In a separate development that stirred investor sentiment, tensions between President Trump and Tesla CEO Elon Musk surfaced after Musk openly criticized proposed tax legislation—a political spat that added to the broader climate of uncertainty in US economic policy.
