Oil Prices Edge Up on Tariff Delay, But Oversupply Fears Linger
Oil prices saw modest gains during early Asian trading on Monday after U.S. President Donald Trump postponed a planned tariff hike on European Union imports, offering temporary relief to markets rattled by trade uncertainty.
Despite the upward movement, price increases remained limited amid persistent concerns about a potential oversupply, especially following reports that OPEC+ may increase production again in July.
As of 21:18 ET (01:18 GMT), July Brent crude futures rose by 0.2% to $64.93 a barrel, while West Texas Intermediate (WTI) crude climbed 0.3% to $61.69.
According to ING analysts, “We’re likely to hear a lot of market chatter this week ahead of the OPEC+ meeting on Sunday, June 1, where decisions on July output levels will be made.”
Trump Pushes Back EU Tariff Deadline
President Trump announced Sunday that the implementation of 50% tariffs on EU imports would be delayed from June 1 to July 9. The change came after a phone call with European Commission President Ursula von der Leyen, during which both sides agreed to intensify trade talks.
This delay eased immediate fears of a further escalation in U.S.-EU trade tensions—fears that had been unsettling global markets. Analysts viewed the decision as a stabilizing factor for the global economy, supporting energy demand expectations and improving market sentiment. It also creates an opportunity for renewed diplomatic engagement aimed at resolving the dispute.
OPEC+ and Iran Talks in Focus for Oil Markets
Markets are also closely monitoring the upcoming OPEC+ meeting scheduled for June 1, where the alliance is expected to decide whether to raise production levels. According to Bloomberg, one option being discussed is a potential increase of 411,000 barrels per day in July, although no official agreement has been reached yet.
ING analysts said, “We’re currently factoring in a 411,000 b/d supply hike in our projections for July, which should help keep the oil market well-supplied into the second half of the year.” OPEC+ has already added output in May and June as part of its gradual rollback of production cuts.
At the same time, President Trump noted that “very good” discussions were held with Iranian representatives over the weekend during the fifth round of nuclear negotiations. Any progress on that front—especially a lifting of sanctions—could allow Iran to boost crude exports, further reinforcing oversupply risks in the market.
