Oil Prices Slip as Market Awaits OPEC+ Decision, Weighs Impact of Trump’s Economic Policies
The global oil market remained subdued on Friday, with Brent crude futures slipping 0.7% to settle at $68.30 a barrel and West Texas Intermediate (WTI) crude down 0.75% to $66.50 just before the U.S. Independence Day holiday Trading volumes were thin due to the holiday, but market analysts were still on high alert as they anticipated the weekend’s OPEC+ meeting.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies are expected to decide on oil production levels for August at a meeting scheduled for Saturday. Eight member countries, including Saudi Arabia and Russia, are likely to increase their output by another 411,000 barrels per day, according to analysts cited in media reports. The move would mark the fourth consecutive month of production hikes.
"A decision to raise oil production by 411,000 barrels per day in August would suggest an accelerated swelling in global oil reserves," said Tamas Varga, an analyst at PVM Oil Associates, a London-based energy analysis firm. "OPEC’s decision will have a direct impact on the global crude market and affect oil prices."
Market sentiment was further complicated by the upcoming meeting between U.S President Donald Trump and his advisors to discuss tax cuts worth $1.5 trillion over the next decade. The move is expected to be signed into law on Friday, which could boost energy demand but also raise concerns about a potential increase in U.S. production.
Analysts predict that investors will be closely watching the impact of Trump’s economic policies on the global oil market, particularly as it relates to trade policy. "Market participants are waiting and seeing what happens with OPEC and then possibly reacting to tax cuts," said Phil Flynn, senior analyst at Price Futures Group in Chicago.
The U.S. was set to resume nuclear negotiations with Iran next week, according to an Axios report published on Friday, which may increase pressure on the global oil market as Iranian crude production could be influenced by a potential deal.
Uncertainty over U.S. tariff policy also remains high ahead of the 90-day deadline for a trade agreement between the European Union and the Trump administration. EU negotiators have so far failed to secure a breakthrough in the talks, which may lead them to seek an extension on current policies to avoid higher tariffs, according to diplomats from six member countries briefed on the matter.
In other developments, Barclays bank raised its Brent oil price forecast to $72 per barrel for 2025 and $70 per barrel for 2026, citing improved demand expectations. The move is part of a trend of upward revisions in oil outlooks due to increasing consumption and production levels worldwide.
Market analysts continue to closely monitor developments on OPEC+ production decisions and their subsequent impact on global markets. The meeting’s outcome could have significant implications for oil prices, supply chains, and global economic policies.
