Oil Prices Linger Below $72 Amid Global Tensions and OPEC+ Moves

Oil prices remain stubbornly below $72 per barrel, with Brent crude hovering around $67 and West Texas Intermediate (WTI) at $64.41, each up just 0.09% as of August 7, 2025. Kuwait, a key OPEC member, predicts this price ceiling will hold in the near term, citing a healthy market with moderate demand growth. However, geopolitical developments, particularly U.S. trade policies and their impact on global oil dynamics, are keeping markets on edge, as OPEC+ monitors supply, demand, and international rhetoric closely.

Kuwait, producing 2.548 million barrels per day under OPEC+ quotas, is carefully watching U.S. actions, including new tariffs targeting India’s imports of Russian crude oil. A recent U.S. executive order imposes an additional 25% tariff on Indian goods, raising the total to 50%, effective 21 days after August 6. This move aims to pressure India, a major buyer of Russian oil, and could disrupt global oil flows, given India’s role as a key consumer and reseller. These developments, alongside U.S. claims of progress in Russia-Ukraine ceasefire talks, are injecting uncertainty into the oil market, with potential to sway prices in either direction.

OPEC+ is navigating its own challenges, planning to unwind a portion of its production cuts by boosting output by 547,000 barrels per day in September. A remaining cut of 1.66 million barrels per day will persist until late 2026, unless market conditions prompt earlier adjustments. Kuwait’s state oil company emphasizes its ability to exceed current production levels if needed, highlighting flexibility to meet shifting demand. Despite these efforts, moderate demand growth and rising U.S. tariffs are capping price gains, keeping oil markets in a cautious holding pattern.

The broader energy sector is also seeing shifts, with companies like Cheniere reporting an 85% surge in Q2 earnings due to robust liquefied natural gas (LNG) demand and higher prices. However, the oil market’s near-term outlook remains constrained, with prices struggling to break above $72. As global trade tensions escalate and OPEC+ adjusts its strategy, investors are bracing for potential volatility, with the interplay of geopolitics and production decisions shaping the path ahead for crude oil.