Oil price falls as trade war concerns increase worries about fuel demand
Brent crude futures fell 52c, or 0.75%, to $68.69 (R1,209) a barrel by 3.25 GMT. US West Texas Intermediate crude was at $66.69 (R1,174) a barrel, down 51c, or 0.76%. The benchmarks settled slightly lower on Monday.
The August West Texas Intermediate contract expires on Tuesday and the more active September contract was down 54c, or 0.82%, to $65.41 (R1.151) a barrel.
'Broad demand concerns continue to simmer amid escalating global trade tensions, specially as markets eye the latest tariff threats between major economies and [US President Donald] Trump's potential announcements ahead of the August 1 deadline,' said Priyanka Sachdeva, senior market analyst at Phillip Nova.
'Investors are also eyeing the ripple effects of fresh US sanctions on Russian crude,' she said.
Supply concerns have largely been alleviated by major producers raising output and since a ceasefire on June 24 ended the conflict between Israel and Iran. However, investors are increasingly worried about the global economy amid US trade policy changes.
A weaker US 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 (US 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 US and the EU over tariffs.
The EU is exploring a broader set of possible countermeasures against the US as prospects for an acceptable trade agreement with Washington fade, according to EU diplomats. The US has threatened to impose a 30% tariff on EU imports on August 1 if a deal is not reached.
There are also signs rising oil 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 showed on Monday.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles

IOL News
3 hours ago
- IOL News
Small businesses warn of Trump tariff impact on toy industry at Comic-Con
Toy companies have been fretting about the impact of Trump's global tariff blitz on the industry, particularly when it comes to China. Image: Andrew Harnik / Getty Images North America / AFP Small business owners used the festive backdrop of Comic-Con on Thursday to discuss a sobering topic: the negative impact that US President Donald Trump's proposed tariffs are having on the toy industry. "Not the most sexy topic," Jonathan Cathey, chief executive of collectibles company The Loyal Subjects, admitted at a panel titled "Toys, Tariffs, and Trade Wars" at the four-day convention in San Diego, California. "But this ultimately affects you guys, it affects the end user," he said. "Prices will go up, and our rate of sales will go down." Toy companies have been fretting about the impact of Trump's global tariff blitz on the industry, particularly when it comes to China. Of over $17 billion worth of toys imported to the United States last year, more than $13 billion came from China. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading But a rollercoaster tariff row between Washington and Beijing has caused havoc for US businesses and their Chinese suppliers. Panel moderator Daniel Pickett argued that the Trump administration is "imposing truly exaggerated, somewhat crazy, and frightening measures." He said Trump's proposal to impose additional tariffs on imports "has only wreaked havoc on the entire industry." Trump recently dismissed warnings by toy giant Hasbro's CEO Chris Cocks about rising prices if higher tariffs were imposed, defending his trade policy by emphasizing it favors domestic production. But Cathey argued the rhetoric doesn't reflect American reality. He said: "There's like 480,000 manufacturing jobs... that aren't even filled. So we're going to do what, we're going to bring a bunch of factory jobs back that nobody can fill." The business owner suggested that US value-addition lies in innovation rather than manufacturing. "There are industries where tariffs make sense," Cathey continued, highlighting the automotive and mining sectors. "There's a mechanism where tariffs make sense that actually protect jobs, American workers, and our national security. Barbie ain't it." Brian Flynn of Super7, a collectibles and action figures brand, said the Trump administration's shifting tariff policies have caused chaos and uncertainty. "Nobody knows what's going to happen," he said, adding that the triple-digit tariffs Trump has sometimes mentioned would "drive everyone out of the market." Flynn said the impact was already visible at Comic-Con, where he had to limit himself to a small concession stand rather than a larger exhibit space. Consumers will feel the impact in their wallets next quarter, he warned. "And when it hits, that's going to make a big difference for us." AFP


The Citizen
4 hours ago
- The Citizen
Weekly economic wrap: local politics and US tariffs coming next week
While inflation remained low in June, the picture can change from 1 August if the US tariff on South Africa remains at 30%. It was another busy week on the local political front, with a minister fired, while on the international front countries are waiting to see if US president Donald Trump will TACO (Trump Always Chickens Out) or stick to his guns and implement the tariffs he recently proposed. Lisette IJssel de Schepper, chief economist at the Bureau for Economic Research (BER) says while it was a big week on the local political front, there was some constructive momentum. President Cyril Ramaphosa dismissed higher education and training minister Nobuhle Nkabane who is facing accusations that she misled parliament. After Nkabane's dismissal, the DA agreed to support the departmental budget on higher education, essentially clearing the way for the Appropriation Bill to be passed. 'While this will not be the last test for the government of national unity (GNU), she says it is a welcome sign that Budget 3.0 can now be finalised, allowing attention to shift toward the October medium term budget policy statement (MTBPS),' De Schepper said. ALSO READ: 'Open our eyes and ears' – Ramaphosa on how to tackle US tariff hike on SA cars US tariffs: will Trump TACO? She said that ahead of next week's 1 August deadline, Trump announced another 'massive' trade deal. Japan and the US agreed on a 15% reciprocal tariff, rather than the 25% that Trump initially threatened. 'Reports suggest that the European Union and the US are nearing a deal, also for 15%, but this has not been confirmed. Unlike other nations or regions, the EU already announced that it has a retaliatory package ready to implement, if necessary, which puts the global economy at additional risk should negotiations fail. 'Trump has said that 15% will probably serve as a floor for reciprocal tariffs, which means the UK was 'lucky' to have been able to settle at 10% early on. In addition to Japan, a deal was reached with the Philippines, with tariffs at 19%, in line with Indonesia and just below Vietnam's 20%.' ALSO READ: JSE All Share Index hit 100k points Oil and gold lower as risk appetite increases Bianca Botes, Citadel Global director, commenting on commodities, says Brent crude breached $69/barrel as markets cheered progress on a US-EU trade agreement, anticipating that reduced tensions would spur global growth and oil demand. 'Supply-side forces further bolstered prices, including constrained Russian exports and tighter diesel markets due to new EU import restrictions and talks of sanctions on Russian oil. These factors offset demand concerns and underpinned the week's rally,' she said Botes saidgold hovered near $3 360 per ounce, consolidating earlier gains after a midweek pullback as risk appetite improved. 'Easing of global trade frictions and equity records prompted some investors to rotate out of safe haven assets, but gold still managed a 0.6% rise for the week, benefiting from lingering uncertainty around US Fed policy and geopolitics.' ALSO READ: Economists lower GDP growth forecast due to global and domestic risks Rand firmed against the dollar this week Turning to the rand, Botes says it firmed against the dollar, moving in tandem with rising JSE equities and elevated commodity prices. 'Steadiness in domestic bond yields, resilient mining sector profits and improved global risk appetite provided support for the currency, despite local growth and fiscal headwinds.' Busisiwe Nkonki and Isaac Matshego, economists at the Nedbank Group Economic Unit, said the rand gained strength on Wednesday, trading at R17.55/$ against the dollar, as inflation increased slightly, suggesting the Reserve Bank (Sarb) may proceed with further interest rate cuts. 'Renewed optimism on the GNU also supported the local unit. All parties in the GNU supported the 2025 Appropriation Bill, dampening earlier fears of a deadlock after the DA threatened to oppose the bill if the president did not act against a truant cabinet minister. 'However, the local unit surrendered some of the gains this morning to trade around R17.77/$ this afternoon.' ALSO READ: Inflation still low enough for repo rate cut, but only in September – economists Inflation edged up to 3% in June as expected Inflation edged up to 3% in June from 2.8% in May, driven by food and non-alcoholic beverages that increased by 5.1% and housing and utilities that increased by 4.4%. The increase in food inflation was mainly driven by an acceleration in meat prices (6.6%) amid supply chain issues due to avian flu and foot and mouth disease, Tshepiso Maroga, economist at the BER, says. Mamello Matikinca-Ngwenya, Siphamandla Mkhwanazi, Thanda Sithole and Koketso Mano, economists at FNB, say they see headline inflation rising to 3.6% in July, as utility and food costs ratchet up and fuel deflation moderates. For the year, they forecast average headline inflation of 3.5%. Nkonki and Matshego also said the increase was in line with their expectations. 'The food price increases were caused by temporary restrictions on poultry imports from Brazil due to avian flu, some tightening in local red meat supplies due to new outbreaks of foot-and-mouth disease and the lingering impact of earlier floods on vegetable and fruit supplies.'

IOL News
4 hours ago
- IOL News
Cognac maker Remy Cointreau lifts guidance after China deal
Louis XIII cognac in a decanter. Louis XIII cognac in a decanter. Image: File. French drinks group Remy Cointreau lifted Friday its outlook for the year after a deal between the EU and China on cognac imports, but now expects a stiffer impact from US levies and the strong euro. The group, which makes Remy Martin and Louis XIII cognac as well as Cointreau orange liqueur, now targets a mid-to-high-single-digits decline in adjusted operating profit for its 2025-2026 financial year, compared with the mid-to-high-teens decline previously forecasted. A major reason behind the improvement is the agreement earlier this month by European brandy exporters to raise prices in China to avoid anti-dumping duties, ending temporary measures that were costing French cognac makers 50 million euros per month. Remy Cointreau now expects a hit of 10 million euros ($11.8 million) from Chinese measures this year, as opposed to the 40 million euros previously. But the company raised its forecast for the impact of US tariffs to 35 million euros, from 25 million previously. The European Union is scrambling to secure a trade deal with the United States before August 1, when Washington has threatened to hike baseline tariffs from 10 to 30 percent. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading The company maintained its forecast of a return to mid-single-digit sales growth stripping out currency changes for 2025-2026, but noted this was primarily due to a rebound from a low comparison base in the United States. Sales rose by 1.8 percent in the April to June quarter to 220.8 billion euros. The gain was 5.7 percent stripping out exchange rate fluctuations and other changes to the business. Quarterly sales in the United States rose from a low base, while they edged lower in Asia due to the Chinese levies and fell in Europe, the Middle East and Africa due to heightened competition and sluggish demand. The strong value of the euro -- it has climbed more than 13 percent against the dollar since the start of the year -- has been weighing upon the results of European companies when they convert foreign sales back into euros. Remy Cointreau said it now expects a negative currency effect impact on sales of between 50 and 60 million euros for its 2025-2026 financial year, up from its earlier estimate of 30 to 35 million euros. It also raised the currency effect impact on adjusted operating profit to between 15 and 20 million euros, compared to 10 to 15 million euros previously. Remy Cointreau's shares jumped around four percent as trading got underway in Paris, while the blue-chip CAC 40 index fell 0.7 percent. AFP