Jul 25, 2025 (MarketLine via COMTEX) --
There was an overall decrease in crude oil prices during the week as uncertainty prevailed in trade deals involving the US and its key partners before its high tariff rates come into effect next month. While Japan struck a deal at 15% US import tariffs, discussions dragged on with other major economies such as the European Union (EU) and China. It raised the prospect of reciprocal tariffs from these economies, and thus pressured prices. Prices were also weighed down by sluggish demand for US manufactured capital goods and a dip in ChinaaEUR(TM)s fiscal revenues. However, the downside to prices was restricted to some extent by signs of falling US crude oil output and a weekly crude and gasoline inventory draw in the country. Moreover, temporary crude supply disruptions from Russia and Turkey further contained the slide in oil prices during the week.
Some key factors that led to changes in crude oil prices this week are as follows:
Oil prices dipped marginally on Monday and then slid on Tuesday, weighed down by concerns over the brewing US-EU tariff dispute that could hamper trade and energy consumption among these major markets. While the August 1, 2025, deadline to finalize a deal grew closer, the two economies remained at loggerheads over certain tariffs. The EU was also contemplating reciprocal tariffs if the US went ahead and imposed 30% on all imports from the region starting next month. Nevertheless, the US managed to seal the deal with another of its major trading partners, Japan, thereby alleviating some worries over a trade slowdown. Besides, the fall in prices was limited to some extent by signs of a likely dip in the US crude oil output. As per the Baker Hughes data, US drillers removed two oil rigs from active operations during the week ending on July 18, 2025. Subsequently, the number of oil rigs deployed for drilling in the country stood at its lowest since September 2021 at 422 units.Oil prices once again dipped marginally on Wednesday, weighed down by prevailing trade worries between the EU and the US. The EU shared a draft proposal with its member countries over potential tariffs on around $109 billion worth of US goods in case if an amicable deal was not signed before the deadline. Meanwhile the EU continued to resolve tariff disputes on diverse goods with US representatives. However, the slide in prices was largely restrained by a weekly crude inventory draw in the US. According to the Energy Information Administration (EIA), crude stockpiles in the country were down by 3.17 million barrels for the week ending on July 18, 2025. Gasoline inventory also drew by 1.7 million barrels during the same week, indicating steady demand for the fuel in domestic transportation. Oil prices rose on Thursday, supported by optimism over the US and the European Union (EU) reaching a trade deal in the coming days. The two trading partners continued to hold talks over tariffs in the region of 15% for certain EU imports and exemptions for some categories of goods. Prices also received support from temporary suspension of Azeri crude oil flows to the Turkish port of Ceyhan over contamination issues in the BP-operated BTC pipeline. Besides, crude loadings at Russia’s Novorossiysk and Yuzhnaya Ozereevka terminals on the Black Sea were briefly halted, lending further support to prices. This was after new security procedures were being adopted for foreign tankers docking at these terminals that export Russian and Kazakh crude oil. Oil prices declined on Friday, weighed down by worries over a slight dip in new orders for US manufactured capital goods in June 2025. As per the US Census Bureau, orders were down 0.7% on a monthly basis for goods excluding aircrafts and defense equipment. Prices were also weighed down by faltering economic growth in China. The country’s Finance Ministry revealed that its fiscal revenues for the first half of 2025 were marginally lower than last year by 0.3%. Nevertheless, the downside to prices was somewhat mitigated by prospects of a trade agreement between the US and the EU as President Trump was due to meet the European block’s head Ursula von der Leyen over the weekend.
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COMTEX_467886901/2227/2025-08-08T09:37:27
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