Brent, WTI Futures Slip Over 0.3% as Demand Forecasts Dim Amid Trade Tensions

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Tariff-Related Conflicts and Softening Growth Hit Oil

Tuesday saw a downward trend in the prices of benchmark crude oil futures, with both Brent and West Texas Intermediate (WTI) registering declines exceeding 0.3%. This dip in oil values occurred against a backdrop of revised demand forecasts from key energy agencies and financial institutions, primarily driven by concerns over slowing global economic growth exacerbated by ongoing international trade disputes.

Specifically, Brent crude futures experienced a decrease of 0.32%, pushing the price below the $65 threshold. This movement reflected a cautious sentiment among traders as they digested the latest assessments of future oil consumption. Similarly, WTI crude futures also saw a decline, falling by 0.34% to settle at $61.32 per barrel. This synchronized movement in both major crude benchmarks highlighted a broad market concern regarding the balance between oil supply and anticipated demand.

A significant factor contributing to this bearish sentiment was the International Energy Agency’s (IEA) decision to lower its demand forecast for oil in 2025. In its most recent monthly Oil Market Report, the IEA revised its projection for demand growth downwards to 730,000 barrels per day (bpd), down 300,000 bpd from previous estimates. Furthermore, the agency projected a further deceleration in demand growth to 690,000 bpd in 2026.

The IEA cited a weakening of global economic growth due to US tariffs as the main factor behind its reduced outlook. The agency noted that while direct tariffs on oil, gas, and refined products are not planned, the broader concerns that these measures could fuel inflation, impede economic expansion, and intensify trade conflicts weigh heavily on oil prices.

Adding to the downward pressure on oil prices was HSBC’s decision to cut its Brent crude oil price forecasts for both 2025 and 2026. The financial institution revised its 2025 estimate down to $68.5 per barrel from a previous projection of $73, and its 2026 figure was lowered to $65 per barrel from $70. US duties were once again presented as a factor behind these reassessments. The Organization of the Petroleum Exporting Countries’ decision to increase production was presented as reasoning. According to the bank, global oil demand is also set to fall to 700,000 bpd for 2025 and 800,000 bpd for 2026, down 200,000 and 100,000 bpd, respectively.