Oil prices slightly rose during the Asian trading session on Friday, but due to market expectations of OPEC+ increasing production and the ongoing uncertainty in U.S.-China trade talks, oil prices may still record a weekly decline. As of 21:28 U.S. Eastern Time (09:28 the next day, Beijing time), Brent crude futures for June delivery rose by 0.3%, reaching $66.77 per barrel; West Texas Intermediate (WTI) futures increased by 0.4%, to $62.38 per barrel.
Although oil prices rebounded on Friday, both crude contracts are expected to fall by nearly 2% this week, with a decline of over 10% since April. Investors are closely monitoring multiple factors to assess the global oil demand outlook.
The news of OPEC+ increasing production has been a major drag on oil prices. According to Reuters, several OPEC+ member countries are pushing to accelerate production increases in June, continuing the unexpected measures from May. Due to internal disputes over quota compliance, this plan might boost supply to 411,000 barrels per day, further raising concerns of oversupply in the market. Amid weak demand, this move could put additional pressure on oil prices.
Furthermore, the uncertainty surrounding U.S.-China trade talks also continues to impact oil price trends. The Trump administration is considering reducing tariffs on Chinese imports to ease trade tensions, which could stimulate economic activity in China, the world's largest oil importer, thus boosting oil demand. Although Trump stated that tariffs will not drop to zero, the potential reduction still brings a glimmer of optimism to the market, supporting oil prices.
Meanwhile, the tension of the Ukrainian war has also supported oil prices. Russia launched the deadliest missile and drone attacks on Kyiv in almost a year, escalating geopolitical tensions and heightening market concerns. U.S. President Trump publicly urged Russian President Putin to cease aggressive actions and warned that these attacks could jeopardize peace talks. Considering Russia is one of the world's top oil producers, fears that the conflict could further disrupt energy markets have slightly driven up oil prices.
Despite the support from geopolitical risks and trade talks, OPEC+ production increase plans and market concerns over oversupply continue to dominate oil price trends, keeping the market cautious about the oil price outlook.
