Oil on Course for Second Weekly Loss as OPEC+ Hike, Trump Tariff Uncertainty Weigh

Oil prices edged lower on Friday, poised for a second straight week of losses, as traders factored in expectations for another OPEC+ output hike in July and fresh uncertainty following a U.S. court ruling that keeps President Donald Trump’s tariffs in place.

Brent crude futures slipped 21 cents, or 0.33%, to $63.94 a barrel by 06:26 GMT, while U.S. West Texas Intermediate (WTI) crude fell 22 cents, or 0.36%, to $60.72 a barrel. The Brent July futures contract is set to expire later Friday.

Both benchmarks have shed 1.3% this week, extending a downtrend fueled by rising supply expectations and geopolitical turbulence.

OPEC+ Hike Looms as Supply Glut Swells

Investor focus remains on the upcoming Saturday meeting of eight OPEC+ members, where another 411,000 barrels per day (bpd) output hike is on the table. With the global oil surplus now estimated at 2.2 million bpd, JPMorgan analysts noted that a price adjustment may be necessary to prompt a supply-side response and restore market balance.

The bank expects prices to stay within current ranges before easing into the high $50s per barrel by the end of the year.

Tariff Whiplash Adds to Market Uncertainty

Adding to the bearish tone, a U.S. federal appeals court on Thursday reinstated Trump’s sweeping trade tariffs, reversing a lower court’s ruling from the day prior. The reinstatement kept the tariffs in effect, driving oil prices down more than 1% on Thursday and reigniting concerns over the economic impact of the tariff battles.

Analysts warned that legal wrangling over the tariffs will likely continue to inject volatility into markets. Since Trump’s “Liberation Day” tariffs were first announced on April 2, oil prices have lost more than 10%.

Demand Outlook Clouded by Recession Fears, Trade Tensions

On the demand side, the tariff war has amplified recession fears and weighed on the global demand outlook. Washington’s latest directive to halt a wide range of exports, including ethane and butane, to China without a license—and its revocation of existing licenses—further darkened the trade landscape.

While U.S. oil consumption rebounded during the Memorial Day holiday, offering some relief, JPMorgan analysts noted that global oil demand growth for May is tracking around 400,000 bpd—250,000 bpd below earlier expectations.

With OPEC+ supply plans, legal volatility around Trump’s tariffs, and trade tensions swirling, oil prices are likely to stay under pressure as the market awaits fresh signals from both producers and policymakers.