Oil Prices Decline as Markets Assess Trump's Deadline for Russia and Tariff Concerns
Oil prices witnessed a decline during trading on Tuesday, July 15, as investors assessed the deadline granted by US President Donald Trump to Russia to settle its dispute with Ukraine, alongside ongoing concerns about the impact of US tariffs on the global economy.
Brent crude recorded a slight decrease of 0.4% to reach $68.93 per barrel, while West Texas Intermediate crude fell by 0.5% to $66.63. This decline followed a previous drop of over a dollar at the close of the previous session.
Trump announced on Monday plans to provide Ukraine with new weapons, while warning of imposing sanctions on buyers of Russian oil if Moscow fails to reach a peace agreement within the next fifty days. Initially, this announcement led to a temporary price increase, but prices quickly fell as traders increasingly believed that the granted deadline might prevent the imposition of sanctions.
In this regard, Daniel Hynes, Chief Commodity Analyst at ANZ Bank, noted that "the deadline eased concerns that direct sanctions on Russia would disrupt crude oil flows," pointing out that "sentiment was also affected by escalating trade tensions."
Market concerns were further heightened after Trump's statements on Saturday regarding his intention to impose a 30% tariff on most imports from the European Union and Mexico starting from August 1, with threats to impose similar measures on other countries. Observers believe that this step could lead to economic growth slowdown, negatively impacting global oil demand.
On a related note, OPEC Secretary-General, Hitham Al-Ghais, anticipated a strong demand for oil during the third quarter of the year, with limited gap between supply and demand in the following months.
On the other hand, Goldman Sachs raised its oil price forecasts for the second half of 2025, based on expectations of supply disruptions, reduced inventories among OECD countries, and restrictions on Russian production.
