OPEC+ Increases Oil Output Amid US Tariff Tensions, Prices Fall

Oil prices declined after reaching recent highs as investors weighed the impact of increased supply from OPEC+ and renewed tariff tensions under President Trump's administration. OPEC+ announced a larger-than-expected output increase of 548,000 barrels per day for August, reversing about 80% of earlier voluntary cuts, which raised concerns about a potential supply glut and intensified market competition. Meanwhile, President Trump issued letters to key U.S. trade partners, including Japan and South Korea, warning of new 25% tariffs effective August 1 but leaving room for negotiations, contributing to market uncertainty. The supply increase from OPEC+ coincided with Saudi Arabia raising its official crude selling price to Asia, signaling confidence in demand despite global economic concerns. Geopolitical risks, such as attacks by Yemen’s Houthi rebels on vessels in the Red Sea, partially offset downward price pressures by raising fears of shipping disruptions. Overall, the combination of tariff risks, rising OPEC+ output, and geopolitical tensions has led to cautious investor sentiment and downward pressure on oil prices.