Oil prices fell on Friday and were poised for a weekly decline of over 3%, driven by concerns over oversupply and uncertainty surrounding tariff talks between the United States and China.
Brent crude futures dropped by 82 cents to $65.73 a barrel, marking a 3.3% decrease for the week. Meanwhile, U.S. West Texas Intermediate (WTI) crude fell 81 cents to $61.98 a barrel, showing a 4.2% decline for the week.
The drop in oil prices came as worries about oversupply from OPEC+ persisted, while the outlook for demand remained uncertain amid ongoing trade tensions. A stronger U.S. dollar also exerted additional pressure on crude prices.
Earlier gains were erased after a spokesperson from China’s foreign ministry stated that there were no consultations or negotiations on tariffs with the U.S., contradicting earlier remarks from U.S. President Donald Trump about ongoing trade talks.
Speculation around the potential for OPEC+ to increase production in June further weighed on oil prices. China, which had raised tariffs on U.S. imports, has now exempted some goods from its 125% tariffs and is seeking to identify critical products that can be exempt from levies, signaling its growing concern over the economic impact of the trade war.
Earlier this month, oil prices plummeted to four-year lows due to fears about global demand and a broader selloff in financial markets triggered by the tariff dispute. Growing concerns about excess supply have also emerged, with several OPEC+ members discussing the possibility of accelerating output increases in June.
Additionally, the potential easing of sanctions on Russia, if the war in Ukraine comes to an end, could allow more Russian oil to enter global markets. Russia, alongside the U.S. and Saudi Arabia, remains one of the world’s largest oil producers.
