Jul 04, 2025 (MarketLine via COMTEX) --
Crude oil prices witnessed an overall increase during the week after Iran snapped relations with the UN-designated nuclear watchdog, leading to speculation that the country might continue investing in nuclear development. Prices also received some support from a dip in the US unemployment rate, indicating improving business environment in the country. However, the upside to oil prices were somewhat contained by fears that the US might reimpose high import tariffs amid the dearth of announcements on agreements with its trading partners. The planned crude oil output hike from the OPEC+ group also contained the rise 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 on Monday and then slid further on Tuesday, weighed down by worries over a likely rise in crude oil supplies from the OPEC+ group. The group is scheduled to meet on July 6, 2025, to discuss the production policy for next month. Initial reports indicated an output increase of 411,000 barrels per day (bpd), similar to what was announced in the past three months. Prices were also weighed down by uncertainty over the US reaching trade deals with its trading partners before the deadline for interim 10% import tariffs ending on July 9, 2025. Amid ongoing discussions with various countries, US Treasure Secretary, Scott Bessent, indicated the possibility of a sharp rise in tariffs if the negotiations prolonged beyond the deadline. Oil prices rose on Wednesday, supported by doubts over long-term stability in the Middle East after the recent Israel-Iran conflict that primarily focused on the latter’s nuclear facilities. In the aftermath of this conflict, Iran announced the suspension of its cooperation with the International Atomic Energy Agency (IAEA) over its biasness towards a particular group of countries. Prices also received support from falling US oil rig count, indicating a likely dip in the country’s output over the coming weeks. As per Baker Hughes, drillers removed six oil rigs during the week ending on June 27, 2025. However, the upside to prices was somewhat contained by an unexpected weekly rise in the country’s crude stockpiles. According to the US Energy Information Administration (EIA), crude inventory in the country increased by 3.8 million barrels for the week ending on June 27, 2025.Oil prices dipped slightly on Thursday, before the US Independence Day holiday on Friday, weighed down by growing concerns over the likely reinstatement of high US tariffs on its trading partners. The US had imposed flat 10% tariffs on most of its trading partners in early April 2025 for a period of 90 days to give sufficient time for negotiations. However, with the deadline getting closer, several key partners, including the European Union and Japan, were yet to finalize an agreement with the US. This raised the possibility of a renewed tariff dispute that would potentially hamper global trade and thus, weigh down energy consumption. However, the downside to prices was somewhat contained by promising employment generation in the US, implying a healthy growth in its economy. According to the US Bureau of Labor Statistics, the country added 147,000 non-farm jobs in June 2025 with the unemployment rate falling to 4.1%, which was better than most industry estimates.
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COMTEX_467201874/2227/2025-07-10T18:06:28
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