Oil slipped over 1% on Tuesday as rising OPEC+ supply and worries of weaker global demand countered concern about U.S. President Donald Trump’s threats to India over its Russian oil purchases.
The Organization of the Petroleum Exporting Countries and its allies, together known as OPEC+, agreed on Sunday to raise oil production by 547,000 barrels per day for September, a move that will end its most recent output cut earlier than planned.
Brent crude futures were down 82 cents, or 1.2%, to $67.94 a barrel at 1245 GMT, while U.S. West Texas Intermediate crude slipped 88 cents, or 1.3%, to $65.41. Both contracts fell by more than 1% on Monday to settle at their lowest in a week.
Trump on Tuesday again threatened higher tariffs on Indian goods over the country’s Russian oil purchases over the next 24 hours. Trump also said declining energy prices could pressure Russian President Vladimir Putin to halt the war in Ukraine. New Delhi called his attack “unjustified” and vowed to protect its economic interests, deepening a trade rift between the two countries.
Oil’s move since Trump’s threat indicates that traders are sceptical of a supply disruption happening, said John Evans of oil broker PVM in a report. He questioned whether Trump would risk higher oil prices.
“I’d call it a stable market for oil,” said Giovanni Staunovo, analyst at UBS. “Assume this likely continues until we figure out what the U.S. president announces in respect to Russia later this week and how those buyers would react.”
India is the biggest buyer of seaborne crude from Russia, importing about 1.75 million bpd from January to June this year, up 1% from a year ago, according to data provided to Reuters by trade sources.
Trump’s threats come amid renewed concerns about oil demand and some analysts expect faltering economic growth in the second half of the year.
