Oil prices have continued their decline for a third consecutive session, driven by heightened trade negotiations between the United States and its key trading partners. The urgency stems from an impending deadline next week, with international benchmark Brent crude trading below $US69 a barrel and West Texas Intermediate hovering near $US67. European Union and US negotiators are intensifying discussions to secure a trade agreement by August 1, the date President Donald Trump has set to potentially impose 30 per cent tariffs on most of the bloc’s exports.
White House Press Secretary Karoline Leavitt indicated that President Trump may issue further unilateral tariff letters before the deadline, suggesting that additional trade deals could be reached in the interim. According to Warren Patterson, head of commodities strategy at ING Groep NV, “With the tariff deadline looming, risks are skewed to the downside.” He added that expectations of a better-supplied oil market later in the year further contribute to the outlook for potential price declines.
Late last week, the European Union reached an agreement on a new package of sanctions against Moscow. These measures include a lowered price cap on Russian crude oil, restrictions on fuels derived from Russian petroleum, and a ban targeting a major refinery located in India. The United Kingdom has aligned itself with these efforts, while the United States has not yet taken similar action.
US Treasury Secretary Scott Bessent has suggested that upcoming talks with China may include discussions regarding Beijing’s purchases of Russian and Iranian oil. This topic could potentially complicate progress, particularly given Russia’s position as China’s largest crude oil supplier.
