West Texas Intermediate (WTI) crude slipped to around $65.40 during early Asian trading on Wednesday, as renewed concerns over global oil demand and trade tensions put pressure on prices.
The latest decline comes amid mounting anxiety over US President Trump’s tariff strategy, which investors fear could dampen global economic growth and reduce fuel consumption. Markets are particularly cautious ahead of the upcoming US Energy Information Administration (EIA) weekly crude inventory data, set to be released later today.
Trump reiterated that, starting August 1, reciprocal tariffs will rise for trade partners that have yet to reach agreements with the US. He also threatened to impose a 30% tariff on European Union imports, fueling fears of a broader economic slowdown that could dent global energy demand.
In addition to demand concerns, worries about increasing oil supply are also pressuring WTI. Iraq has officially resumed crude exports from the Kurdistan Region for the first time in over two years, a move aimed at easing tensions between Baghdad and Erbil. The resumed flow is expected to add around 230,000 barrels per day (bpd) to Iraq’s overall export volume, contributing to fears of a potential supply glut.
On a slightly more positive note for oil bulls, US crude inventories posted a modest decline last week. According to the American Petroleum Institute (API), stockpiles fell by 577,000 barrels for the week ending July 18, reversing part of the previous week’s massive 19.1 million-barrel increase. Despite the dip, total US crude inventories have still risen by roughly 11 million barrels since the start of the year.
With mixed signals on both supply and demand, traders remain cautious, awaiting further clarity from the EIA report and potential developments in global trade negotiations.
