Oil prices recover slightly but US tariffs, OPEC downgrade weigh

Synopsis

Oil prices rebounded slightly on Friday after a previous drop spurred by President Trump's new tariffs and OPEC's lowered demand forecasts. OPEC's recent report anticipates a decrease in global oil demand by 2026, primarily due to slowing demand from China.

Oil prices steadied in early trading on Friday following a 2% drop in the previous session that was driven by U.S. President Donald Trump's new tariffs, expected to hurt economic growth, and a cut to OPEC demand forecasts.

Brent crude futures rose 19 cents, or 0.28%, to $68.83 a barrel as of 0037 GMT. U.S. West Texas Intermediate crude ticked up 26 cents to $66.83 a barrel, up 0.39%.

The Organization of the Petroleum Exporting Countries (OPEC), in its 2025 World Oil Outlook published on Thursday, cut its forecasts for global oil demand in 2026 to 2029 because of slowing Chinese demand.

Global demand will average 106.3 million barrels per day (bpd) in 2026, OPEC said, down from 108 million bpd expected in last year's forecast.

U.S. President Donald Trump on Thursday announced a 35% tariff rate for goods imported from Canada, starting August 1, and said the United States planned to impose blanket tariffs of 15% or 20% on most other trade partners.

Earlier in the day, President Trump threatened punitive tariffs on Brazil, Latin America's largest economy, and laid out plans for duties on copper, semiconductors and pharmaceuticals.

The European Union is expected to propose a floating Russian oil price cap in a new sanctions package this week, after a fall in oil prices made the current cap irrelevant, according to EU diplomat sources on Thursday.

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