Oil prices eased slightly on Thursday as traders weighed the risk of slower global energy demand stemming from tariff uncertainty, just ahead of a widely anticipated supply boost from OPEC+ producers. Brent crude settled down 31 cents, or 0.45%, at $68.80 a barrel, while U.S. West Texas Intermediate (WTI) crude dropped 45 cents, or 0.67%, to $67.00 in thin trading before the Independence Day holiday.
Market participants grew increasingly cautious ahead of the July 9 expiration of U.S. President Donald Trump’s 90-day pause on tariff implementation. With major trade deals still unresolved—particularly with the European Union and Japan—concerns mounted that escalating trade tensions could weigh on global economic growth and fuel demand. While Wednesday’s trade deal with Vietnam provided a brief lift, overall sentiment remains clouded by uncertainty.
Further pressure came from expectations that OPEC+ will agree to a 411,000 barrels per day output hike during its policy meeting this weekend. A slowdown in China’s service sector growth in June, the weakest in nine months, also signaled waning demand from the world’s largest oil importer. Meanwhile, a surprise build in U.S. crude inventories added to bearish sentiment. The U.S. Energy Information Administration reported a 3.8 million barrel increase in crude stocks last week, contrasting with analyst forecasts for a drawdown.
U.S. oil production signals also leaned bearish. The number of active oil rigs fell by seven to 425, according to Baker Hughes—the lowest count since September 2021. While U.S. job growth came in stronger than expected for June, nearly half of the gains were in the public sector. Slower hiring in manufacturing and retail, attributed to tariffs, suggested underlying economic headwinds.
Although geopolitical tension remains in the background—highlighted by Iran suspending cooperation with the U.N. nuclear watchdog and new U.S. sanctions—market reaction was muted.