Crude oil prices inched higher on Thursday after a sharp 2% decline in the previous session, as markets assessed growing tensions within OPEC+ over production policy. Brent crude rose $0.08, or 0.12%, to $66.20 per barrel, while U.S. West Texas Intermediate (WTI) added $0.09, or 0.14%, to $62.36 by early morning GMT.
The rebound came as investors weighed the potential for an accelerated OPEC+ supply increase next month. According to sources cited by Reuters, several member states are lobbying to raise output faster in June, which could pressure prices further if consensus within the group frays.
Discontent among smaller producers is intensifying. Kazakhstan, accounting for roughly 2% of global output, signaled it would prioritize national interests over OPEC+ compliance—a stance reminiscent of Angola’s 2023 exit from the alliance. ING analysts warned that deeper discord could trigger a price war, creating headwinds for oil stability.
U.S.-China Tariffs Stir Demand Uncertainty
Compounding the uncertainty, the White House sent mixed signals on its stance toward Chinese tariffs. President Trump is reportedly considering lowering tariffs from 145% to 50%, seeking to revive trade talks with Beijing. Yet White House Press Secretary Karoline Leavitt later emphasized that no tariff reductions would occur unilaterally.
Meanwhile, Treasury Secretary Scott Bessent acknowledged that the current tariff regime was “not sustainable,” hinting at the economic necessity for a policy shift. Analysts at Rystad Energy cautioned that an extended trade standoff could halve China’s projected oil demand growth—from 180,000 barrels per day to just 90,000 bpd.
Market sentiment remains vulnerable to:
- Shifting U.S.-China tariff policies
- Potential auto part tariff exemptions
- Global economic impact on fuel consumption
Iran Nuclear Talks May Add Supply Pressure
Oil traders are also closely monitoring the U.S.-Iran nuclear negotiations, which enter a third round of talks this weekend. A breakthrough could lead to sanctions relief, unlocking additional Iranian supply into global markets.
However, any progress remains tenuous. The U.S. imposed new sanctions on Iran’s energy sector this week, drawing sharp criticism from Tehran. Iranian officials argued the move undermines Washington’s credibility and suggests a lack of genuine intent to reach a diplomatic solution.
For now, oil remains caught between geopolitical flashpoints and production politics, with investors awaiting clearer signals from both OPEC+ and the world’s two largest economies.