London: Oil prices edged higher on Thursday as a U.S. court struck down key elements of former President Donald Trump’s tariff policies, boosting market sentiment amid growing anticipation of new sanctions on Russian crude and a pivotal OPEC+ output decision for July.
By 1215 GMT, Brent crude futures had risen by 19 cents, or 0.3%, to $65.09 per barrel, while U.S. West Texas Intermediate (WTI) crude gained 24 cents, or 0.4%, to $62.08.
The price uptick followed a ruling from the U.S. Court of International Trade, which determined that Trump exceeded his legal authority when he imposed sweeping tariffs on imports from major U.S. trade partners. The court did not address industry-specific duties, such as those targeting automobiles, steel, and aluminum—tariffs that were enacted under separate legal provisions.
“Markets are positive since Donald Trump got the setbacks on the tariffs,” said Bjarne Schieldrop, chief commodities analyst at SEB. “That’s less headwind for the global economy, so more demand for oil because the machine of the global economy moves better and faster.”
The court’s decision lifted global risk appetite, which had been constrained by fears that protectionist trade measures might dampen economic growth and suppress energy demand. However, analysts cautioned that the market relief could be short-lived, as the Trump administration intends to appeal the ruling.
“But for now, investors get a breather from the economic uncertainty they love to loathe,” said Matt Simpson, analyst at City Index in Brisbane.
Geopolitical and Supply-Side Factors Add to Market Caution
Beyond trade developments, traders are closely watching for potential new U.S. sanctions targeting Russian oil exports—an action that could tighten global crude supply and push prices higher.
At the same time, attention is fixed on an upcoming meeting of the Organization of the Petroleum Exporting Countries and allies (OPEC+), scheduled for Saturday. Observers expect the coalition to approve another production increase for July.
“We’re assuming the group will agree on another large supply increase of 411,000 barrels per day. We expect similar increases through until the end of the third quarter, as the group increases its focus on defending market share,” analysts from ING wrote in a research note.
Supply risks were further compounded after Chevron Corp. terminated its oil operations in Venezuela. The move followed the Trump administration’s revocation of a critical operating license in March. Venezuela later canceled Chevron’s scheduled crude cargoes in April due to sanctions-related payment complications.
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Prior to the license withdrawal, Chevron had been exporting around 290,000 barrels per day from Venezuela, representing over a third of the country’s total oil shipments.
“From May through August, the data points to a constructive, bullish bias with liquids demand set to outpace supply,” said Mukesh Sahdev, global head of commodity markets at Rystad Energy. He forecast a demand surplus of 600,000 to 700,000 barrels per day (bpd) during the period.
Market Awaiting Inventory Reports and Impact of Canadian Wildfires
Later on Thursday, traders will closely examine weekly U.S. oil inventory reports from the American Petroleum Institute (API) and the Energy Information Administration (EIA). According to sources familiar with API figures, U.S. crude and gasoline stocks declined last week, while distillate inventories saw a slight increase.
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Additionally, a wildfire in Alberta, Canada, prompted the evacuation of a small town and led to the temporary shutdown of some local oil and gas production facilities—another factor that could contribute to tightening supplies in the North American market.
