Aug 08, 2025 (MarketLine via COMTEX) --
There was an overall decrease in crude oil prices during the week on worrying outlook for global trade due to high US tariffs. The US raised its import tariffs on select countries, and then hiked them further for goods from India, thus stoking domestic inflation concerns in the US and a probable slowdown in bilateral trade. The idea behind this tariff hike was to curb IndiaaEUR(TM)s imports of Russian crude oil, which might in turn, pressure Russia into negotiating a ceasefire with Ukraine. Nevertheless, so far it had failed to achieve its desired objective, while talks continued over halting the Ukraine conflict. Prices also came under pressure from the OPEC+ decision to increase its planned production volumes for September 2025, after announcing multiple hikes in the past months. Moreover, prices also fell amid indications that negotiations between Russia and the US to end the Ukraine conflict were in their final stages. The presidents of the two countries are schedule to meet in Alaska on August 15, 2025, to finalize a peace accord in this protracted conflict.
Some key factors that led to changes in crude oil prices this week are as follows:
Oil prices declined on Monday and Tuesday, weighed down by worries over the possibility of higher crude availability in global markets from next month. This was after the OPEC+ agreed to lift its collective production target by another 547,000 barrels per day (bpd) from September 2025. Prices were also weighed down by deteriorating US-India trade relations over purchasing goods from Russia amid the protracted Ukraine conflict. As negotiations over a Ukrainian peace deal continued to stall, the US President Trump gave indications of imposing 100% secondary tariffs on India for procuring crude oil from Russia. India insisted on continuing to import from Russia at current levels of around 1.7 million bpd while highlighting that the US itself was a prominent importer of Russian commodities, especially fertilizers and palladium. Amid this stand-off, two oil tankers loaded with cargo from Russia and heading towards India apparently altered their course midway due to worries over getting sanctioned. Nevertheless, any change in India’s stance could cause some disruption in global crude oil supplies as it would seek alternative sellers to meet its energy needs. Oil prices continued their slide on Wednesday as well, weighed down by signs of some progress in the Ukraine peace deal after positive talks among senior US representatives and Russian President Vladimir Putin. A potential ceasefire in this conflict could considerably ease the risks to Russian energy supplies and ensure the stable availability of crude oil in global markets. However, the fall in oil prices was somewhat lessened by a weekly draw in the US crude stockpiles. As per the Energy Information Administration (EIA) data, crude inventory was down by 3 million barrels for the week ending on August 1, 2025. Oil prices declined further on Thursday, weighed down by the announcement from Russia that its President, Vladimir Putin, would meet with the US President Donald Trump soon. This development raised hopes of an end to the Russia-Ukraine conflict, which would alleviate the risks to energy assets arising from it. Prices were also weighed down by uncertainty over the global trade and macroeconomic outlook after the US hiked its import tariffs for India to 50% as the country is a notable buyer of Russian crude oil. It raised the possibility of the US implementing a similar tariff hike on China, a leading importer of crude oil from Russia, that might impact global trade.Oil prices rose slightly on Friday, supported by reports of an annual surge of 11.5% in crude oil imports from China in July 2025, indicating strong demand from this major economy. However, the upside to prices was largely restrained by expectations of a ceasefire in Ukraine. For the first time since this conflict started in February 2022, the heads of the US and Russia had agreed to meet in person. This meeting would likely be held next week with a view to bring the conflict to a permanent halt and negotiate the revised border between Russia and Ukraine.
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COMTEX_468155315/2227/2025-08-19T09:36:36
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