Oil Remains Stable With Eyes On OPEC+ Meeting And US Tariff Uncertainty

The price action came amid concerns that the coalition of oil-producing nations, known as OPEC+, might press ahead with its accelerated production plan.

In addition to supply concerns, uncertainty over global economic momentum due to the US tariff policy is also weighing on oil price movement.

Source : Freepik

Oil prices remained largely unchanged on Tuesday after an early-session dip, as traders focused on the upcoming OPEC+ meeting that could determine whether output levels will be raised further in August.

Around 12 noon, Brent crude was trading at $66.84 per barrel, up by 10 cents or 0.2 per cent, while US West Texas Intermediate (WTI) crude gained 9 cents, or 0.1 per cent, to reach $65.20 a barrel, reported Reuters.

The price action came amid concerns that the coalition of oil-producing nations, known as OPEC+, might press ahead with its accelerated production plan.

"The market is now concerned that the OPEC+ alliance will continue with its accelerated rate of output increases," noted ANZ’s senior commodity strategist Daniel Hynes in a research note.

According to four OPEC+ sources cited by the news agency, the group is expected to announce a production increase of 411,000 barrels per day (bpd) for August, following similar boosts implemented in May, June, and July.

Ample Supply Outlook Tempers Market Reactions

If the proposed increase is finalised during the July 6 meeting, it would bring the group’s total additional supply for the year to 1.78 million bpd—more than 1.5 per cent of the world’s total oil demand.

Analysts at ING suggested that these increases should ensure sufficient availability of oil for the remainder of the year. "These larger supply increases should leave the global oil market well supplied for the remainder of the year," ING commodities strategists wrote, adding, "Expectations for a comfortable oil balance, along with a large amount of OPEC spare production capacity, appear to be comforting the market."

In addition to supply concerns, uncertainty over global economic momentum due to the US tariff policy is also weighing on oil price movement. US Treasury Secretary Scott Bessent warned that, as the July 9 deadline approaches, countries could face sharply higher tariff rates—potentially reverting from the current 10 per cent to as high as 50 per cent, depending on prior announcements by President Donald Trump.

Geopolitical Risk Premium Eases

Meanwhile, oil market sentiment has also been influenced by recent geopolitical developments. A 12-day military conflict that began on June 13, when Israel launched strikes against Iran’s nuclear infrastructure, caused Brent crude prices to jump above $80 a barrel. However, prices soon declined to $67 after President Trump declared a ceasefire between Israel and Iran.

Looking ahead, Morgan Stanley forecasts a decline in Brent crude futures to approximately $60 by early next year, citing improved supply conditions and reduced geopolitical tensions. The firm also anticipates a surplus of 1.3 million bpd by 2026, further easing concerns about long-term market tightness.