Oil prices rose to two-week highs on Tuesday, driven by a reduced U.S. production outlook, fresh Houthi attacks in the Red Sea, and a surprise move by President Donald Trump to impose steep copper tariffs. Brent crude settled up 57 cents, or 0.8%, at $70.15 a barrel, while U.S. West Texas Intermediate (WTI) gained 40 cents, or 0.6%, to close at $68.33. Both benchmarks marked their highest closes since June 23 for a second consecutive session.
The U.S. Energy Information Administration (EIA) revised its forecast downward for 2025 crude output, citing slowing activity as a result of declining oil prices. Meanwhile, Trump’s announcement of a 50% tariff on copper—aimed at boosting domestic production—surprised markets and helped rally both oil and copper prices, the latter hitting a record high.
In the Red Sea, a deadly drone and speedboat attack on the bulk carrier Eternity C—the second maritime incident of the day—highlighted the renewed threat to shipping. These attacks are pushing vessels carrying oil and gas to take longer, costlier routes, raising global energy transport costs.
Oil markets also found support from technical short covering, with Brent breaching the $70 level, a key resistance point. Strength in refining margins added to the bullish tone, with U.S. gasoline and diesel prices climbing and crack spreads reaching multi-month highs.
Despite ongoing bearish pressures—such as Trump’s broader tariff threats and the upcoming OPEC+ output hike of 548,000 barrels per day in August—analysts noted oil’s resilience. The American Petroleum Institute and EIA inventory reports are expected to show a 2.1 million barrel drawdown in U.S. crude stockpiles, which, if confirmed, would mark the sixth draw in seven weeks, reinforcing demand strength.