Oil edges lower as trade war concerns increase worries about fuel demand
Brent crude futures fell 24 cents, or 0.35%, to $68.97 a barrel by 0055 GMT after settling 0.1% lower on Monday.
U.S. West Texas Intermediate crude was at $66.99 a barrel, down 21 cents, or 0.31%, following a 0.2% loss in the previous session.
The August WTI contract expires on Tuesday and the more active September contract was down 23 cents, or 0.35%, to $65.72 a barrel.
Still, the oil market has struggled to find any direction since the ceasefire on June 24 ending the conflict between Israel and Iran removed concerns about major supply disruptions in the key Middle East producing region.
Since then, Brent has traded in a range of $5.19 and WTI in a range of $5.65 as supply concerns have been alleviated by major producers raising output and investors are increasingly worried about the global economy amid U.S. trade policy changes. However, a weaker U.S. dollar has provided some backing for crude as buyers using other currencies are paying relatively less.
Prices have slipped "as trade war concerns offset the support by a softer (U.S. dollar)," IG market analyst Tony Sycamore wrote in a note.
Sycamore also pointed to the possibility of an escalation in the trade dispute between the U.S. and the EU over tariffs.
The EU is exploring a broader set of possible counter-measures against the United States as prospects for an acceptable trade agreement with Washington fade, according to EU diplomats. The U.S. has threatened to impose a 30% tariff on EU imports on August 1 if a deal is not reached.
There are also signs rising supply has entered the market as the Organization of the Petroleum Exporting Countries and their allies unwind output cuts.
Saudi Arabia's crude oil exports in May rose to their highest in three months, data from the Joint Organizations Data Initiative (JODI) showed on Monday. (Reporting by Anjana Anil in Bengaluru; Editing by Christian Schmollinger)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Gulf Today
2 hours ago
- Gulf Today
Trump announces 25% tariff on India, additional import tax
WASHINGTON: The United States will impose a 25% tariff on goods from India, plus an additional import tax because of India's purchasing of Russian oil, President Donald Trump said Wednesday. India "is our friend,' Trump said on his Truth Social platform, but its tariffs "are far too high' on US products. The Republican president added India buys military equipment and oil from Russia, enabling Moscow's war in Ukraine. As a result, he intends to charge an additional "penalty' starting on Friday as part of the launch of his administration's revised tariffs on multiple countries. The Indian government said Wednesday it's studying the implications of Trump's tariffs announcement. India and the US have been engaged in negotiations on concluding a "fair, balanced and mutually beneficial' bilateral trade agreement over the last few months, and New Delhi remains committed to that objective, India's Trade Ministry said in a statement. Trump's announcement comes after a slew of negotiated trade frameworks with the European Union, Japan, the Philippines and Indonesia - all of which he said would open markets for American goods while enabling the US to raise tax rates on imports. The president views tariff revenues as a way to help offset the budget deficit increases tied to his recent income tax cuts and generate more domestic factory jobs. While Trump has effectively wielded tariffs as a cudgel to reset the terms of trade, the economic impact is uncertain as most economists expect a slowdown in US growth and greater inflationary pressures as some of the costs of the taxes are passed along to domestic businesses and consumers. There's also the possibility of more tariffs coming on trade partners with Russia as well as on pharmaceutical drugs and computer chips. Kevin Hassett, director of the White House National Economic Council, said Trump and US Trade Representative Jamieson Greer would announce the Russia-related tariff rates on India at a later date. Trump's approach of putting a 15% tariff on America's long-standing allies in the EU is also generating pushback, possibly causing European partners as well as Canada to seek alternatives to US leadership on the world stage. French President Emmanuel Macron said Wednesday in the aftermath of the trade framework that Europe "does not see itself sufficiently' as a global power, saying in a cabinet meeting that negotiations with the US will continue as the agreement gets formalized. "To be free, you have to be feared,' Macron said. "We have not been feared enough. There is a greater urgency than ever to accelerate the European agenda for sovereignty and competitiveness.' Washington has long sought to develop a deeper partnership with New Delhi, which is seen as a bulwark against China. Indian Prime Minister Narendra Modi has established a good working relationship with Trump, and the two leaders are likely to further boost cooperation between their countries. The Census Bureau reported that the US ran a $45.8 billion trade imbalance in goods with India last year, meaning it imported more than it exported. At a population exceeding 1.4 billion people, India is the world's largest country and a possible geopolitical counterbalance to China. India and Russia have close relations, and New Delhi has not supported Western sanctions on Moscow over its war in Ukraine. The new tariffs could put India at a disadvantage in the US market relative to Vietnam, Bangladesh and, possibly, China, said Ajay Sahai, director general of the Federation of Indian Export Organisations. "We are back to square one as Trump hasn't spelled out what the penalties would be in addition to the tariff,' Sahai said. "The demand for Indian goods is bound to be hit.' The new tariffs on India could complicate its goal of doubling bilateral trade with the US to $500 billion by 2030. The two countries have had five rounds of negotiations for a bilateral trade agreement. While US has been seeking greater market access and zero tariff on almost all its exports, India has expressed reservations on throwing open sectors such as agriculture and dairy, which employ a bulk of the country's population for livelihood, Indian officials said. When Trump in February met with Modi, the US president said that India would start buying American oil and natural gas. Trump discussed his policies on trade and tariffs with reporters accompanying him Tuesday on the flight home following a five-day visit to Scotland. He declined to comment then when asked about reports that India was bracing for a US tariff rate of at least 25%, saying, "We're going to see.' Trump also said the outlines of a trade framework with India had not yet been finalized. Once back at the White House on Tuesday, Trump indicated that there were no plans to announce new tariff rates on Wednesday, a claim that turned out to be inaccurate. Agencies
Gulf Today
2 hours ago
- Gulf Today
Life after cod: Latvia reinvents its coastal communities
Imants Liepins, Agence France-Presse Fishers do not usually wish for a "perfect storm". But Latvian boating communities are hoping for exactly that: a rare tempest that might, one day, revive waning stocks of Baltic cod. Decreasing salinity in the Baltic Sea is robbing the saltwater fish of the conditions it needs to thrive. And as its population shrinks, so do the fishing traditions that have long characterised villages along Latvia's 494-kilometre (307-mile) coastline. The result for the communities in this small EU nation is a drive to reinvent themselves, to survive. With the European Union steadily cutting allowable catches of Baltic cod, and moving towards a total ban to replenish stocks, towns and villages are diversifying into tourism and seafood processing. "We launched a new marina for yachting, offered services for sea travellers, and a French investor opened a brand new shipyard for yacht building," Agris Stulbergs, harbourmaster for the port in the village of Engure, explained to AFP. Leisure boating has become a favoured activity in this village, located just 50 kilometres from the capital Riga, and others. Farther west, in the port city of Ventspils, Juris Petersons, a lifelong seaman, reminisced how Latvian fishers used to bring in lavish hauls of fish highly valued in kitchens from Russia to Britain. "Back in the mid-80s the Latvian fishing fleet brought in 55,000 tons of Baltic cod, in addition to salmon, herring and many other saltwater fish," he said. Now "the environmental conditions have become so unfavourable to cod growth that Latvian fishermen are allowed to catch just 16 tonnes of cod a year," he said. "And even that amounts only to the accidental by-catch when we fish for herring," said Petersons, an industrial fishing boat skipper until he sold off his trawlers last year. The Baltic Sea is fed by a number of large freshwater rivers. It is connected with the North Sea only through the shallow Danish straits, preventing Atlantic saltwater from entering the Baltic basin. In order to recover, the cod population would need a rare seastorm, with just the right windspeed at the correct angle to push masses of saltwater into the Baltic Sea. That "happened at least twice during the previous century, but currently we're waiting for that perfect storm for the third decade", Petersons said. Given the smaller yield, many in the industry have focused on quality over quantity. "All the fish canning companies... have either gone out of business or turned their production lines into making more valuable export-grade products," said Janis Megnis, chief of the Roja port administration. Their high quality herring and anchovy products "can be found today from Walmart in the United States to stores in Australia and Japan", he said. Political changes have also affected the industry. Historically Latvia's fish processing industry mainly served markets in Russia and Belarus. But with the Russian annexation of Crimea in 2014, followed by Moscow's invasion of Ukraine in 2022, and the resulting Western sanctions, Latvian fishing companies have been forced to seek other markets. The biggest importers today are Canada, Ukraine, Poland, Romania, Denmark and the UK, according to the agriculture ministry. New markets include Arab countries and South Africa. Many families in Latvia's coastal towns have also turned their former fisheries into guesthouses and vacation destinations or switched from selling raw fish to the more lucrative smoked, prepared and spiced varieties. "My husband is a fifth-generation fisherman: he goes out to sea for fish, which we then smoke and turn into high-end products," said Iveta Celkarte, who runs a fishing estate in Berzciems village. "We also have a family cafe... serving our own seafood," said Celkarte, who has also become a television and social media personality. Celkarte offers three-hour tours about the history of traditional fishing, taking visitors on a stroll through dunes to the shore and finishing with a special meal. "For me it is important to tell people about the traditions of our coast, the history of fishing and the life of previous generations working on the sea" she said. Aivars Lembergs, a former mayor of Ventspils, said he began turning his city into a manufacturing hub and developing tourism has been key, and is paying off. The city is seeing many tourists coming in from neighbouring Lithuania. "During summers you'll sometimes see more Lithuanians on the streets of Ventspils than Latvians, as Lithuania has a very short Baltic coastline, and their tourists come here to enjoy the short Baltic summer," said Lembergs, who was mayor between 1988 and 2021.
Khaleej Times
2 hours ago
- Khaleej Times
UAE Central Bank maintain benchmark interest rate
The UAE Central Bank on Wednesday announced that it maintained its benchmark rate. In a statement, the Central Bank said it was maintaining its Overnight Deposit Facility at 4.4 per cent. The decision was taken after the US Federal Reserve maintained its benchmark rate at 4.25-4.5 per cent. The UAE follows US monetary policy as the dirham is pegged to the US dollar.
