Oil Prices Dip as Supply Pressures Weigh on Market Despite Geopolitical Tensions
Global oil prices slipped on Friday as supply concerns outweighed geopolitical risks, with traders preparing for the expiration of Brent’s October contract.
At 02:51 GMT, Brent crude futures for October delivery fell 53 cents, or 0.8%, to $68.09 per barrel, while the more actively traded November contract dropped 48 cents, or 0.7%, to $67.50. U.S. West Texas Intermediate (WTI) crude was down 51 cents, or 0.8%, at $64.09.
Despite Friday’s decline, both benchmarks are set for weekly gains—Brent up 0.6% and WTI higher by 0.8%. Earlier in the week, prices climbed after Ukrainian strikes targeted Russian oil export terminals and German Chancellor Friedrich Merz ruled out peace talks between Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy.
However, seasonal factors are putting downward pressure on the market. The end of the U.S. summer driving season with Monday’s Labor Day holiday, coupled with fresh supply from OPEC+ producers as voluntary output cuts wind down, is weighing on sentiment.
“We expect rising OPEC+ supply and a seasonal fall in global refining activity from September will result in a pick-up in global oil stockpiles in the coming months. We forecast Brent oil futures falling to $63 per barrel in the fourth quarter of 2025,” said Vivek Dhar, commodities analyst at the Commonwealth Bank of Australia.
Fresh geopolitical risks remain in focus. Russian missile strikes on Kyiv on Thursday killed 23 people, fueling speculation that Washington could respond with tougher sanctions.
“Uncertainty lingers over whether the U.S. and Europe may tighten sanctions against Russia following its attack on Ukraine, and over the potential impact of U.S. tariffs on India, making investors reluctant to take large positions,” said Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment.
Washington’s pressure on New Delhi to reduce purchases of Russian crude has also rattled markets. President Donald Trump this week doubled tariffs on Indian imports to as high as 50%, but traders say Russian shipments to India are still expected to rise in September.
Meanwhile, Saudi Arabia may lower October crude prices for Asian buyers, with refiners citing abundant supply and weakening demand.
In Europe, Russian crude flows to Hungary and Slovakia through the Druzhba pipeline have resumed after disruptions caused by a Ukrainian strike last week, officials from Hungarian energy firm MOL and Slovakia’s economy ministry confirmed.
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