11 Feb 2025

• WTI price holds gains as Russian Oil production in January fell further below the country’s OPEC+ quota.
• Oil prices experience resistance amid rising trade tensions and economic uncertainty following US tariffs on steel and aluminum imports.
• Geopolitical tensions increase as Trump urges Israel to end ceasefire with Hamas if hostages are not returned by the weekend.
• West Texas Intermediate (WTI) crude oil prices are experiencing an upward trajectory for the third consecutive day, currently trading at approximately $72.20 during the Asian trading session on Tuesday. This increase in crude oil prices is bolstered by apprehensions regarding escalating supply risks.
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The potential for an increase in WTI prices appears constrained due to escalating trade tensions and economic uncertainty stemming from US President Donald Trump’s decision to implement a 25% tariff hike on steel and aluminum imports. This action raises apprehensions regarding global economic growth and energy consumption in the United States, which is the largest oil consumer worldwide.

As reported by Bloomberg, sources that remain unnamed suggest that Russian oil production in January has further declined below the country's OPEC+ quota, with output decreasing to 8.962 million barrels per day—16,000 barrels short of its target as per the OPEC+ agreement.

In parallel, new sanctions imposed by the US are aimed at individuals and vessels involved in transporting Iranian crude oil to China, thereby intensifying pressure on Tehran. Iranian President Masoud Pezeshkian has urged OPEC members to stand united against possible US sanctions, following Trump’s announcement regarding plans to eliminate Iran’s oil exports entirely.

Geopolitical tensions in the Middle East may also bolster crude oil prices. Trump has called on Israel to terminate its ceasefire with Hamas if hostages are not returned by the weekend, heightening the risk of renewed conflict as both parties accuse one another of breaching the agreement.

Furthermore, a Reuters survey of economists indicates that the Federal Reserve may delay interest rate cuts until the next quarter due to concerns over inflation. Many analysts who previously expected a rate cut in March have revised their predictions, with the majority now forecasting at least one cut by June. Elevated interest rates could hinder economic growth in the United States, potentially leading to a decrease in oil demand.