Oil prices fall on tariff worries, weak demand outlook

Oil prices fell on Friday as concerns grew that widening US trade tariffs could dampen global demand and trigger a supply surplus, while early signs of possible diplomatic engagement between Washington and Moscow did little to lift sentiment.

International benchmark Brent crude traded at $66.09 per barrel at 10.28 a.m. local time (0728 GMT), down 0.10% from Thursday’s close of $66.16.

US benchmark West Texas Intermediate (WTI) stood at $63.07 per barrel, a 0.23% drop from $63.22 in the previous session.

President Donald Trump’s announcement of new restrictions targeting Russia’s oil sector and steep tariffs on Indian goods briefly supported prices, but gains quickly faded

As tariffs on some of Washington’s key trading partners took effect on Aug. 7, the move reinforced expectations of growing global economic disruptions and weaker oil demand.

Concerns that demand could slow due to the widening scope of US trade tariffs are weighing on the market.

On the supply side, a recent decision by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to raise production quotas in September added pressure on prices. The group continues to gradually unwind the output cuts it has maintained for nearly three years.

Meanwhile, reports of potential peace talks between Trump and Russian President Vladimir Putin over the war in Ukraine also weighed on oil by easing global risk perceptions.

If confirmed, the meeting would mark the first in-person talks between sitting US and Russian presidents since Joe Biden met Putin in Geneva in June 2021.

According to the Kremlin, both presidents agreed to meet in the “coming days” to discuss ending the war in Ukraine, as Trump’s deadline for Russia to agree to a ceasefire in Ukraine or face sanctions is due to expire today.

By Handan Kazanci