West Texas Intermediate (WTI) crude oil slipped to around $65.75 during early Asian trading on Friday, pressured by mounting concerns over rising supply, unexpected inventory builds in the U.S., and renewed tariff threats.
Crude prices came under pressure after OPEC+ agreed on July 6 to boost collective production by 548,000 barrels per day (bpd) starting in August. This follows previous increases of 411,000 bpd for May, June, and July — a pace three times faster than initially planned. The accelerated output raises fears of oversupply, putting additional strain on WTI in the short term.
Adding to the bearish sentiment, U.S. crude inventories posted a sharp rise. According to the Energy Information Administration (EIA), crude stockpiles surged by 7.070 million barrels for the week ending July 4, far exceeding the expected 2 million-barrel draw and the previous week’s 3.835 million-barrel build.
Further weighing on prices, former U.S. President Donald Trump announced new tariffs on key imports including copper, semiconductors, and pharmaceuticals. Notably, Brazil faces a steep 50% tariff beginning in August, one of the highest imposed yet. The escalation in trade tensions has fueled fears of a broader slowdown in global trade and economic activity, which could dampen demand for oil.
However, geopolitical unrest in the Middle East may help limit further declines. Reuters reported that four crew members were killed and eleven remain missing—six of whom are believed to have been kidnapped—following a Houthi attack, underscoring the ongoing instability in the region.
