Will Ongoing Supply Concerns Drag Oil Prices Lower?
Oil is heading for a weekly loss of over 2% as oversupply fears and shaky demand outlooks weigh heavily on the market. Analysts from LSEG highlighted persistent concerns about rising OPEC+ output and a stronger U.S. dollar adding further pressure to prices. Recent suggestions that OPEC+ could accelerate production hikes as early as June have fueled bearish sentiment.
How Are Trade Tensions Between the U.S. and China Impacting Crude Oil?
Hopes for a thaw in U.S.-China trade relations were dashed when China’s foreign ministry denied any active tariff talks, contradicting earlier claims by President Trump. This reversal triggered a pullback in oil prices as traders recalibrated demand expectations. Despite Beijing’s move to exempt some U.S. imports from punitive tariffs, fears around weakening global demand remain front and center.
Could Geopolitical Developments in Ukraine Influence Oil Supply?
Progress between the U.S. and Russia over ending the Ukraine war has raised speculation about a potential easing of sanctions. If Russian oil flows return to the market, the global supply picture could become even heavier, adding to the bearish tone. As one of the largest producers within OPEC+, Russia’s potential comeback is closely watched by energy traders.
Oil Prices Forecast: Bearish Outlook Dominates
With no immediate bullish drivers and supply-side risks mounting, the near-term oil prices forecast remains bearish. Traders should be prepared for a potential retest of $59.67 if sentiment continues to sour, especially if OPEC+ moves forward with production increases and trade war tensions escalate further.
More Information in our Economic Calendar.