Oil prices dip after U.S. tariff moves, OPEC+ output hike

July 08, 2025 (MLN): Oil prices eased on Tuesday after rising almost 2% in the previous session, as investors assessed new developments on U.S. tariffs and a higher-than-expected OPEC+ output hike for August.

Brent crude futures decreased by $0.08, or 0.11%, to $69.5 per barrel.

West Texas Intermediate (WTI) crude futures fall by $0.12, or 0.18%, to $67.81 per barrel by [12:55 pm] PST.

U.S. President Donald Trump on Monday notified trade partners, including key suppliers South Korea and Japan, as well as smaller exporters like Serbia, Thailand, and Tunisia, that significantly higher U.S. tariffs will take effect starting August 1.

The move marks a new phase in the trade war launched earlier this year.

The announcement has fueled market uncertainty and raised concerns over a potential negative impact on the global economy, which could in turn affect oil demand.

Despite these fears, signs of strong current demand particularly in the United States, the world’s largest oil consumer have provided support to oil prices.

According to data released last week by travel group AAA, a record 72.2 million Americans were expected to travel more than 50 miles (80 km) for Fourth of July vacations, highlighting strong domestic consumption.

Investor sentiment also remained bullish ahead of the holiday period.

Data from the U.S. Commodity Futures Trading Commission, released on Monday, showed that money managers increased their net-long futures and options positions in crude oil contracts during the week ending July 1.

On the supply side, the Organization of the Petroleum Exporting Countries and allies (OPEC+) agreed on Saturday to raise production by 548,000 barrels per day (bpd) in August.

This move surpasses the 411,000 bpd hikes implemented in the previous three months and removes nearly all of the 2.2m bpd in voluntary cuts.

Goldman Sachs analysts anticipate OPEC+ will announce a final 550,000 bpd increase for September at their next meeting on August 3.

However, actual output increases have so far trailed announced levels, with the majority of new supply attributed to Saudi Arabia, analysts noted.  

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