Oil prices edged higher in early Friday trading, but gains remained limited as markets continued to digest a fresh round of US tariff threats and a downward revision to global oil demand from OPEC.
Brent crude futures rose 19 cents, or 0.28 percent, to $68.83 a barrel as of 0037 GMT. US West Texas Intermediate (WTI) crude gained 26 cents, or 0.39 percent, to reach $66.83. The modest rebound followed a 2 percent slide in the previous session, triggered by concerns over global trade disruptions and weaker demand expectations.
Brent Crude Futures Daily Chart as of July 11th, 2025 (Source: TradingView)
OPEC Lowers Demand Outlook Through 2029
The Organization of the Petroleum Exporting Countries (OPEC) on Thursday released its 2025 World Oil Outlook, which included a downgrade to global demand projections for 2026 through 2029. OPEC now expects average global demand to reach 106.3 million barrels per day (bpd) in 2026, down from the 108 million bpd forecast issued last year.
The revision reflects expectations of slower demand growth from China, the world’s second-largest oil consumer, as well as increased energy efficiency and alternative fuel adoption.
Tariff Tensions Add to Downward Pressure
Weighing further on sentiment was a new round of trade measures announced by US President Donald Trump on Thursday. The former president introduced a 35 percent tariff on Canadian imports beginning August 1 and floated blanket tariffs of up to 20 percent on a wide range of other trading partners.
Trump also threatened punitive tariffs on Brazil and outlined additional duties targeting copper, semiconductors, and pharmaceuticals, escalating trade tensions that analysts warn could threaten global growth and energy demand.
Geopolitical Risk and Sanctions in Focus
Elsewhere, the European Union is preparing to propose a floating price cap on Russian oil as part of a new sanctions package, according to EU diplomatic sources. The move comes after the current fixed price cap became ineffective due to falling market prices for Russian crude.
While the new cap is not yet finalized, traders are watching closely for signs of renewed volatility or potential supply disruptions tied to enforcement.
Outlook Remains Cautious
Despite the slight recovery in oil prices, headwinds remain. Weakening global demand projections, escalating trade tensions, and shifting geopolitical dynamics are contributing to uncertainty in the energy markets. Analysts expect crude prices to remain volatile in the near term as traders weigh short-term supply factors against broader macroeconomic risks.
