Aug 01, 2025 (MarketLine via COMTEX) --
Crude oil prices increased overall during the week after the US managed to finalize an agreement over bilateral trade with the European Union. The country also pushed back its deadline for securing a deal with China, lending hopes of expanding its trade with this partner. However, the US reverted to high import tariffs on imports from India and Brazil after struggling to strike a trade deal with these countries, thus somewhat limiting the upside to oil prices. Additionally, prices received support from strong US economic data over the April-June 2025 period. However, the gains in oil prices were contained to some extent by sluggish jobs data from the US as well as a weekly surge in the countryaEUR(TM)s commercial crude stockpiles.
Some key factors that led to changes in crude oil prices this week are as follows:
Oil prices gained on Monday and Tuesday, supported by expectations of an increase in the US-EU trade after the two markets agreed a deal well before the deadline on August 1, 2025, when the former’s high import tariffs come into effect. The agreement ensured that most EU goods would be charged 15% import tariffs in the US. The region also expressed interest in purchasing around $750 billion worth of US energy products over the next few years. Moreover, the US pushed back its deadline for China by 12 days while the two countries engaged in negotiations over tariff rates, thus giving additional support to prices. Besides, prices also received support from simmering tensions in the Ukraine conflict amid lack of progress in peace negotiations. In this regard, the US issued a ten-day deadline for a ceasefire while it prepared an elaborate sanctions package that would apply not only on Russia, but also on the buyers of its crude oil. Oil prices rose further on Wednesday, supported by an unexpected rise in the US gross domestic product (GDP) during the second quarter (Q2) of 2025. The country’s GDP grew by 3% year-on-year in Q2 even though the country was engrossed in a tariff dispute with most of its trading partners. Exports from the US were down by 1.8% annually over this period while imports dropped by 30%, thereby contributing to the favorable economic data. Prices also received support from expectations of the US levying secondary sanctions on countries purchasing crude oil from Russia as peace negotiations with Ukraine stretched on. However, the gains in oil prices were restrained by trade worries after the US imposed import tariffs of 25% and 50% on India and Brazil, respectively, effective from August 1, 2025.Oil prices fell on Thursday and Friday, weighed down by concerns over a likely announcement of a large hike in the OPEC+ crude oil output for September 2025. The group was widely anticipated to lift its production ceiling by a similar margin as last month during its forthcoming meet, potentially causing an oversupply in global markets. Prices were also weighed down by worries over brewing tariff dispute between the US and some of its trading partners, such as Canada, India, Brazil and Taiwan. This was after the US levied high tariffs on goods imported from these countries but left a provision to roll them back if a deal was struck with these markets. Weak monthly job growth in the US also weighed on oil prices after government data revealed that only 73,000 non-farm jobs were added across the country in July 2025. Besides, a large weekly crude inventory build put additional pressure on oil prices. According to the US Energy Information Administration (EIA), crude stockpiles in the country jumped by 7.7 million barrels for the week ending on July 25, 2025.
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COMTEX_467886847/2227/2025-08-08T09:36:17
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