Oil prices remained largely unchanged on Friday but stayed on track for strong weekly gains, as global investors closely monitored the effects of sweeping U.S. tariffs and looming sanctions announced by former President Donald Trump.
Brent crude futures slipped by 35 cents (0.49%) to $71.35 a barrel by 10:39 GMT, while U.S. West Texas Intermediate (WTI) crude eased by 37 cents (0.53%) to $68.89. Despite the slight dip, both benchmarks maintained weekly gains—Brent up 4.3% and WTI up 5.7%.
The market steadied after Thursday’s decline of over 1%, with sentiment shaped by the launch of a fresh wave of U.S. import tariffs taking effect Friday. The executive order, signed Thursday, introduced duties between 10% and 41% on imports from numerous countries that failed to finalize trade agreements by the August 1 deadline. Among the affected were Canada, India, and Taiwan, while the EU, Japan, South Korea, and the UK secured trade deals.
Subro Sarkar of DBS Bank noted that the upbeat market tone is largely due to successful trade agreements by major partners. “With several nations managing to ink favorable deals, optimism returned to the energy sector. Progress with China could further fuel bullish sentiment,” he said.
Oil prices were also buoyed by Trump’s proposal of secondary sanctions — up to 100% — aimed at countries buying Russian oil. The move could significantly impact global supplies, as fears mount over possible disruptions in Russian crude exports.
Commerzbank analyst Carsten Fritsch emphasized the challenge: “You simply can’t replace Russian oil entirely. Strict sanctions will likely send oil prices much higher.”
JPMorgan estimates suggest the proposed sanctions on China and India — the world’s second and third largest oil consumers — could disrupt up to 2.75 million barrels per day of Russia’s seaborne exports, adding further risk to supply chains.
Yet some experts warn that the tariff pressure could dampen global economic momentum. Rising prices and trade uncertainty may strain consumer demand, especially in the U.S., which leads global oil consumption. June’s inflation data already reflected early signs of price hikes tied to existing tariffs.
As oil markets ride the wave of political decisions, traders are bracing for more volatility, with geopolitics and economic indicators both pulling at the levers of price direction.
