Crude oil markets are heating up once again, as geopolitical tensions and upcoming U.S. energy data fuel price volatility. With President Donald Trump’s aggressive new tariff threats and the Energy Information Administration’s (EIA) inventory report on deck, oil traders are watching closely.
Trump Turns Up the Heat on Russia
The big trigger? President Trump’s 10-day ultimatum to Russia to end its military campaign in Ukraine—or face 100% secondary tariffs. This policy shift slashed the previous 50-day deadline and sent a shockwave through global oil markets.
In response, Brent crude climbed to $71.78 per barrel, while U.S. West Texas Intermediate (WTI) edged up to $69.29. The September Brent contract, set to expire shortly, rose even higher to $72.69—the strongest level since late June.
Secondary Sanctions and China’s Dilemma
The tariff threat isn’t isolated. China, the world’s biggest buyer of Russian crude, was warned it could face retaliatory tariffs if it continues its oil purchases. Treasury Secretary Scott Bessent made it clear during EU trade talks in Stockholm: compliance is expected, or consequences will follow.
JP Morgan analysts noted that while Beijing is unlikely to yield to U.S. pressure, India might. That could put 2.3 million barrels per day of Russian oil exports at risk—enough to rattle even the most stable energy traders.
Global Trade Wars Ease, but Risks Remain
In a rare moment of cooperation, the U.S. and European Union agreed to a 15% tariff deal, easing fears of a full-blown trade war. The agreement, which includes a pledge from the EU to buy $750 billion in U.S. energy products, boosted market confidence.
Oil also found support from talks of extending the U.S.-China trade truce, with high-level meetings ongoing in Stockholm. Netflix, Amazon, and even Manchester United stocks saw minor gains amid the improved sentiment.
Venezuela and OPEC+ Add to Supply-Side Drama
While geopolitical jitters drive prices higher, supply-side dynamics are also in flux. Venezuela’s state-run PDVSA may resume joint operations—if President Trump renews swap-based export authorizations. This could inject additional supply into an already tense market.
Meanwhile, OPEC+ is gearing up for its August 3 meeting. Compliance is the hot topic, as some member states push for production increases. Any shift could have immediate consequences on price dynamics.
Market Data: The Technical Picture
According to Century Financial CIO Vijay Valecha, WTI bounced back from the critical $66 support level. A bullish engulfing pattern emerged on daily charts, with prices climbing above both the 9- and 21-day simple moving averages. Resistance is seen around the 200-day SMA at $68.39, with a potential breakout targeting $70.02.
Source: Bloomberg Terminal
EIA Report: What to Expect
All eyes are now on the EIA’s weekly crude oil stockpile report. Last week, the American Petroleum Institute (API) reported a surprise build of 1.539 million barrels, versus an expected drawdown of 2.5 million. The discrepancy sent shockwaves through commodities platforms like TradingView and Investing.com.
Year-to-date, U.S. inventories have climbed by nearly 13 million barrels. A surprise draw in today’s EIA numbers could add further upside pressure on WTI and Brent contracts.
Macro Picture: Fed Holds Steady, IMF Warns
The U.S. Federal Reserve is expected to keep interest rates steady between 4.25% and 4.50%. Meanwhile, the IMF has revised global growth forecasts slightly upward for 2025–2026. Still, risks remain: rising tariffs, fiscal deficits, and unpredictable geopolitical developments threaten to derail progress.
Disney, Tesla, and Apple—often considered economic bellwethers—have seen mixed performance in recent sessions, indicating the fragility of broader sentiment.
Conclusion: High Stakes and Higher Prices?
With politics, policy, and supply pressures converging, oil markets are entering a new phase of volatility. Traders will be glued to the EIA’s update, Fed’s interest rate decision, and any unexpected comments from President Trump. The next 10 days could shape the price narrative well into Q4 2025.
This article is for informational purposes only and does not constitute financial advice. Readers are encouraged to do thorough research before making any investment decisions.
