Mar 07, 2025 (MarketLine via COMTEX) --
There was an overall decrease in crude oil prices during the week amid signs of crude oil oversupply in global markets. This was after the OPEC+ agreed to lift its collective crude oil output in April 2025. Prices were also weighed down by uncertainty over global crude oil demand outlook amid the US tariffs and resultant response from its trading partners. However, the slide in oil prices was somewhat restrained due to prospects of tight crude supply in global markets amid reports that the US government was likely to place maximum pressure on IranaEUR(TM)s economy via the strict enforcement of sanctions. In this regard, the country has been working on newer approaches to ensure strict compliance with its sanctions on crude oil exports.
Some key factors that led to changes in crude oil prices this week are as follows:
Oil prices fell on Monday and dipped further on Tuesday, after the OPEC+ announced its first crude oil output hike in over two years of 138,000 bpd for April 2025. It raised the possibility of the group announcing further increases in subsequent months, thereby potentially leading to surplus crude in global markets. Prices were also weighed down by signs of US-China trade war after the latter levied retaliatory tariffs on several US goods. Elsewhere, the US halted all military aid to Ukraine following a fallout between their respective Presidents over the minerals deal. The US was also reportedly identifying sanctions on Russia that could be rolled back to progress on ending the Ukraine conflict, which put additional pressure on prices. Oil prices continued their slide on Wednesday, weighed down by renewed concerns over the outlook for trade in select markets amid the revival of tariff wars. After China, Canada also reciprocated with 25% import tariffs on diverse US goods amounting to over $100 billion. Meanwhile, Mexico was also contemplating to respond to the imposition of US tariffs. Prices were also weighed down by a weekly crude inventory build in the US. According to the US Energy Information Administration (EIA), crude stockpiles in the country rose by 3.6 million barrels for the week ending on February 28, 2025. Oil prices rose slightly on Thursday and then increased further on Friday, supported by a respite in the brewing tariff dispute among North American countries. This was after the US granted a month-long tariff exemption to goods produced in Canada and Mexico, which are compliant with the “United States of America, the United Mexican States, and Canada (USMCA)” trade agreement. Prices also received some support from prospects of the US introducing additional sanctions on Iran to contain its crude oil exports. The US government stated that it was evaluating new ways to curb both Iran’s sanctioned and approved crude oil exports, such as those to its neighbor Iraq. Media reports also indicated a possibility of conducting physical inspections of cargo onboard Iranian oil tankers while in transit to enforce these sanctions. Elsewhere, Russia intensified its military offensive on Ukraine amid talks over a peace deal, prompting the US to threaten the former with new sanctions and tariffs, which gave further fillip to oil prices.
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COMTEX_463599989/2227/2025-03-14T09:37:01
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